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Superior Gaming, a computer enhancement company, has three product lines: audio enhancers, video enhancers, and connection-speed accelerators. Common costs are allocated based on relative sales.

Superior Gaming, a computer enhancement company, has three product lines: audio enhancers, video enhancers, and connection-speed accelerators. Common costs are allocated based on relative sales. A product line income statement for the year ended December 31, 2011 follows:

Audio Video Accelerators Total
Sales $1,045,000 $2,255,000 $2,200,000 $5,500,000
Less COGS 575,000 1,240,000 1,870,000 3,685,000
Gross margin 470,000 1,015,000 330,000 1,815,000
Less other var costs 53,000 69,000 20,000 142,000
Contribution margin 417,000 946,000 310,000 1,673,000
Less direct salaries 155,000 175,000 65,000 395,000
Less common fixed costs:
Rent 11,970 25,830 25,200 63,000
Utilities 4,370 9,430 9,200 23,000
Depreciation 5,890 12,710 12,400 31,000
Other admin costs 79,230 170,970 166,800 417,000
Net income $160,540 $552,060 $31,400 $744,000

Since the profit for accelerators is relatively low, the company is considering dropping this product line. What is the effect of dropping accelerators on total net income?

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