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The management of Bonga Corporation is considering dropping product D74F. Data from the company's accounting system for this product for last year appear below: Sales

The management of Bonga Corporation is considering dropping product D74F. Data from the company's accounting system for this product for last year appear below:

Sales $ 940,000
Variable expenses $ 414,000
Fixed manufacturing expenses $ 354,000
Fixed selling and administrative expenses $ 261,000

All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $216,000 of the fixed manufacturing expenses and $127,000 of the fixed selling and administrative expenses are avoidable if product D74F is discontinued.

What would be the financial advantage (disadvantage) from dropping product D74F?

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