Discussion:
The management of furrow corporation is considering dropping product Lo7E. data from the company's accounting system appear below: Sales $830,000, Variable expense $365,000, fixed manufacturing $291,000, fixed selling administrative $160,000. in the company's accounting system all fixed expenses of the company are fully allocated to products further investigation have revealed that $186,000 of the fixed manufacturing expenses and $106,000 of the fixed selling and administrative expense are avoidable if product Lo7E is discontinue . what would be the effect on the company overall net operating income if product Lo7E were dropped?