Part 4: Differential Analysis 1. Keep or Drop MN Co. has two product lines in its tool stores: hammers and wrenches. Results of July follow: Hammers 800 $23,800 $13,600 Wrenches 1,200 $30,400 $13,200 Total 2,000 $54,200 $26,800 Units sold Sales Variable costs Fixed costs Salary of product line manager Allocated factory overhead Operating income (loss) $5,000 $ 8,000 S(2.800) $7,000 $9,000 $1,200 $12,000 $17,000 $(1,600) The company is currently considering if it should drop the product line of hammers to improve the company's profitability, MN Co. estimates that dropping hammers will increase demand of wrenches by 10%. The allocated factory overhead will NOT be affected by dropping any of the product lines. Please use differential analysis to determine whether MN Co. should keep or drop the product line of hammers. Please show all calculations and label items clearly to support your decision making. (25 points)