1. True
2. False

A company has two different products that sell to separate markets. Financial data are as follows: Product A Product B Revenue Variable costs Fixed costs (allocated) Operating income (loss) $16,000 (7,000) (3,000) $6,000 $9,400 (9,600) (2,000) Tota I $26,400 (16,600) (6,000) $3,900 Assume that fixed costs are all unavoidable and that dropping one product would not impact sales of the other. Because the contribution margin of Product a is negative, it should be dropped.