The management of Austin Corporation is considering dropping product R97C.Data from the company's accounting system appear below: 
In the company's accounting system all fixed expenses of the company are fully allocated to products.Further investigation has revealed that $34,000 of the fixed manufacturing expenses and $20,000 of the fixed selling and administrative expenses are avoidable if product R97C is discontinued.What would be the effect on the company's overall net operating income if product R97C were dropped?
Definitions:
EBIT
Earnings Before Interest and Taxes - an indicator of a company's profitability that calculates income without tax expenses and interest expenses.
Straight Line
A method of allocating the cost of a tangible asset over its useful life in equal installments.
Net Income
The net income a company achieves once all costs and taxes are subtracted from its total revenues.
Cash Flow
The net amount of cash and cash-equivalents moving into and out of a business, crucial for assessing liquidity, flexibility, and overall financial performance.
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