The Mansfield Company manufactures and sells two lines of fishing rods. During the most recent accounting period, the Pro line and the Novice line sold 18,000 and 5,000 units, respectively. The company's most recent financial statements are shown below:

	Pro				Novice
Sales	$	1,080,000			$	600,000
Less cost of goods sold:
Unit-level production cost		720,000				337,500
Depreciation, production equipment		170,000				125,000
Gross margin	$	190,000			$	137,500
Less operating expenses:
Unit-level selling and administrative costs		47,500				162,500
Corporate-level facility expenses (fixed)		43,200				43,200
Net income (loss)	$	99,300			$	(68,200	)

Based on this information, the company should:

Multiple Choice

• Eliminate the Novice line because it is operating at a loss.

• Keep the Novice line because it contributes $100,000 to total profitability.

• It is impossible to determine with the given information.

• Keep the Novice line because it contributes $137,500 to total profitability.