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MSI is considering eliminating a product from its ToddleTown Tours collection. This collection is aimed at children one to three years of age and includes "tours" of a hypothetical town. Two products, The Pet Store Parade and The Grocery Getaway, have impressive sales. However, sales for the third CD in the collection, The Post Office Polka, have lagged the others. Several other CDs are planned for this collection, but none is ready for production MSI's Information related to the Toddletown Tours collection follows: Segmented Income Statement for MSI'S ToddleTown Tour Product Linen Sales revenue Variable costo Contribution margin Less Direct Fixed costa Segment margin Lean Common fixed costs. Not operating income (Loss) Pet Store Parade $85,000 37,000 $48,000 6,200 341,800 3,500 $33,300 Post Grocery Office Getaway Polka Total $80,000 $26,000 $191,000 33,000 21,000 91,000 $47,000 $5,000 $100,000 5.200 4.000 16,200 $41,800 $ 200 $ 83,800 8,000 2,600 19,100 $33,000 $12.400) 564.700 "Allocated based on total sales revenue. MSI has determined that elimination of the Post Office Polka (POP) program would not impact soles of the other two items. The remaining fixed overhead currently allocated to the POP product would be redistributed to the remaining two products, Required: 1. Calculate the incremental effect on profit if the POP product is eliminated 2. Should MSI drop the POP product? 3-a. Calculate the incremental effect on profit if the POP product is eliminated. Suppose that $2,000 of the common fixed costs could be avoided if the POP product line were eliminated 3-b. Should MSI drop the POP product? Complete this question by entering your answers in the tabs below. Req1 Reg 2 Req3A Reg 38 Calculate the incremental effect on profit if the POP product is eliminated Effect on Pront Reg 2 > Required information sales. However, sales for the third CD in the collection, The Post Office Polka, have lagged the others. Several other CDs are planned for this collection, but none is ready for production MSI's information related to the Toddletown Tours collection follows: Segmented Income Statement for MSI'S ToddleTown Tours Product Lines Pet Post Store Grocery Office Parade Getaway Polka Total Sales revenue $85,000 $80,000 $26,000 $191,000 Variable costs 37,000 33,000 21,000 91,000 Contribution margin $48,000 $47,000 $ 5.000 $100,000 Less Direct Fixed costs 6,200 5,200 4,800 16,200 Segment margin $41,800 $41,800 $ 200 $ 83,800 Less Common fixed costs 8.500 8.000 2.600 19, 100 Het operating income (loss) $33,300 $33,800 $12,400) $ 64,700 *Allocated based on total sales revenue. MSI has determined that elimination of the Post Office Polka (POP) program would not impact sales of the other two items. The remaining fixed overhead currently allocated to the POP product would be redistributed to the remaining two products. Required: 1. Calculate the incremental effect on profit if the POP product is eliminated. 2. Should MSI drop the POP product? 3-o. Calculate the incremental effect on profit If the POP product is eliminated. Suppose that $2,000 of the common fixed costs could be avoided if the POP product line were eliminated. 3-b. Should MSI drop the POP product? Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg JA Reg 38 Calculate the incremental effect on profit if the POP product is eliminated. Suppose that $2,000 of the common fixed costs could be avoided if the POP product line were eliminated Eflect on Proht

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