Wildhorse Toys' management is considering eliminating product A, which has been showing a loss for several years. The company's annual income statement, is as follows: Sales Variable expenses Contribution margin Advertising expense Depreciation expense Corporate expenses Total fixed expenses Operating income Total $2,235,000 $1,410,000 $1,806,500 $5,451,500 1,698,000 601,200 1,099,800 3,399,000 $537,000 $808,800 $706,700 $2,052,500 $520,000 $429,000 $521,000 $1,470,000 16,700 10,700 21,500 48,900 92,300 84,100 106,600 283,000 $629,000 $523,800 $649,100 $1,801,900 $(92,000) $285,000 $57,600 $250,600 dy Advertising expense - Specific to each product. Depreciation expense - Specific to each product; no other use available, no resale value. Corporate expenses - Allocated based on number of employees. (a) Your answer is correct. Restate the income statement in segment margin format. sdgment Total Sales Revenue 2235000 1410000 1806500 5451500 Variable expenses 1698000 601200 1099800 3399000 Contribution margin 537000 808800 706700 2052500 Direct fixed expenses Your answer is correct. Restate the income statement in segment margin format. A B Total Sales Revenue 2235000 1410000 1806500 5451500 Variable expenses 1698000 601200 1099800 3399000 Contribution margin 537000 808800 706700 2052500 Less Direct fixed expenses Advertising 520000 429000 521000 1470000 Depreciation 16700 10700 21500 48900 Segment margin 300 369100 164200 533600 Less Common fixed expenses 283000 Operating profit 250600 Your answer is partially correct. Try again. What would be the effect on income if product A were dropped? X decrease 300 Net income would by $U