question

6.   The management of Rodarmel Corporation is considering dropping product G91Q. Data from the company’s accounting system appear below:       Sales $370,000   Variable expenses $170,000   Fixed manufacturing expenses $118,000   Fixed selling and administrative expenses $89,000         All fixed expenses of the company are fully allocated to products in the company’s accounting system. Further investigation has revealed that $57,000 of the fixed manufacturing expenses and $40,000 of the fixed selling and administrative expenses are avoidable if product G91Q is discontinued.    Required:a.What is the net operating income(loss) earned by product G91Q according to the company’s accounting system? (Input the amount as a positive value.)         $  by$ [removed]          b2.Should the product be dropped?   [removed]Yes[removed]No   Problem 2Rothery Co. manufactures and sells medals for winners of athletic and other events. Its manufacturing plant hasthe capacity to produce 18,000 medals each month; current monthly production is 17,100 medals. The companynormally charges $88 per medal. Cost data for the current level of production are shown below:The company has just received a special one-time order for 600 medals at $73 each. For this particular order, novariable selling and administrative costs would be incurred. This order would also have no effect on fixed costs.Required: Should the company accept this special order? Why?