A company is considering eliminating one of its products. The summarized income statement for the product (Product 101) is as follows:
| Sales |
$2165764
|
|
Variable costs
|
1401210
|
|
|
Contribution margin
|
764554
|
|
|
Fixed costs
|
936847
|
|
|
Operating loss
|
$-172293
|
|
If the product 101 is dropped, the sales of product 108 will increase by 22.22%. Product 108's sales are $2672913 and its contribution margin ratio is 31.12%. Of the $936847 of Product 101's fixed costs, only $262194 of costs are avoidable. What is the incremental benefit (cost) to the company if Product 101 is dropped?