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Thalassines Kataskeves, S . A . , of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for

Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump follows:Thalassines Kataskeves, S.A.Income StatementBilge PumpFor the Quarter Ended March 31Sales $ 410,000Variable expenses: Variable manufacturing expenses$ 127,000 Sales commissions53,000 Shipping20,000 Total variable expenses 200,000Contribution margin 210,000Fixed expenses: Advertising (for the bilge pump product line)22,000 Depreciation of equipment (no resale value)106,000 General factory overhead48,000* Salary of product-line manager121,000 Insurance on inventories13,000 Purchasing department40,000 Total fixed expenses 350,000Net operating loss $ (140,000)*Common costs allocated on the basis of machine-hours.Common costs allocated on the basis of sales dollars.Discontinuing the bilge pump would not affect sales of other product lines and would have no effect on the companys total general factory overhead or total Purchasing Department expenses.Required:What is the financial advantage (disadvantage) of discontinuing the bilge pump?

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