Your Retail Store's accountant prepared the following income statement for the ladies' accessories product line: $3,225,000 1,515,750 1,709, 250 Sales Less: Variable expenses Contribution margin Less: Fixed expenses: Wages Insurance on inventory Advertising Net operating income (loss) $1,161,000 64,500 709,500 1,935,000 $ (225,750) Management is concerned about the loss and is considering dropping the product line. If the product line is dropped, a job has to be created elsewhere for a long-term employee currently earning an annual salary of $96,750. Required: Calculate the increase or decrease in the operating income in both alternatives. Keep Accesories Product Line Drop Accesories Product Line Sales + Fixed expenses Net operating income (loss) Should the ladies' accessories product line be dropped? O Yes O No