Question: Diva Footwear is contemplating if it should continue producing platform shoes. The following information is available for the company's segments. Platform Shoes Athletic Shoes Boots

Diva Footwear is contemplating if it should continue producing platform shoes. The following information is available for the company's segments.

Platform ShoesAthletic ShoesBoots

Sales$120,000$420,000$360,000

Variable costs64,000220,000140,000

Contribution margin56,000200,000220,000

Direct fixed costs45,00070,00090,000

Allocated fixed costs20,00070,00060,000

Net income($9,000)$60,000$ 70,000

If platform shoes are dropped, what effect will occur to Diva Footwear's net income?

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