Required:

PLEASE answer BLANKS in blue box as explained below:

Net operating income (loss) would __1___ by __2___ if product B90D were dropped. Therefore, the product ___3___ dropped.

1. Decline or increase?
2. Calculate: What would be the financial advantage (disadvantage) of dropping B90D? Should the product be dropped?
3. Should be or should not be?

**Answer 1, 2 & 3 to complete blue box.

The management of Wengel Corporation is considering dropping product B90D. Data from the company's accounting system appear below: All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $194,000 of the fixed manufacturing expenses and $168,200 of the fixed selling and administrative expenses are avoidable if product B90D is discontinued. Required: What would be the financial advantage (disadvantage) of dropping B90D? Should the product be dropped