Answer:
The computation of given question is below:-
Explanation:
Continue Eliminate Net income/Loss
Sales $201,000 $0 ($201,000)
Variable cost $176,000 $0 $176,000
Contribution margin $25,000 $0 ($25,000)
Fixed cost $30,700 $20,000 $10,700
Net income/ loss ($5,700) ($20,000) ($14,300)
In Net Income, Eliminating the product line is leading to Decrease by $15,400, the product line should be continued.
