8. Farmit, Inc, has 2 small retail stores that specialize in fence supplies and small tools. The company's income statement shows the following results for the current year. The company is concemed about future profits as sales have been dropping a small amount consistently every year due to a new competitor. The accountant analyzed the fixed costs and determined that 40% is direct to fence supplies, 20% is direct to small tools, and 40% is allocated not to sell small tools. 9. Use the information provided in 8. above for FarmIt, Inc. FarmIt, Inc. is considering adding heavy duty tools to the selection of tools they sell. Sales and contribution margin from heavy duty tools is expected to be $100,000 and $30,000 respectively. The stores will have to be remodeled at a cost of $15,000 and new shelves will have to be purchased at a cost of $4,000. A purchasing manager will have to be hired who specializes in heavy duty tools for $38,000.20% of the allocated fixed costs for the company will be allocated to heavy duty tools. Determine the change to FarmIt, Inc.'s current operating income of $50,000 if the line is added. 8. Farmit, Inc, has 2 small retail stores that specialize in fence supplies and small tools. The company's income statement shows the following results for the current year. The company is concemed about future profits as sales have been dropping a small amount consistently every year due to a new competitor. The accountant analyzed the fixed costs and determined that 40% is direct to fence supplies, 20% is direct to small tools, and 40% is allocated not to sell small tools. 9. Use the information provided in 8. above for FarmIt, Inc. FarmIt, Inc. is considering adding heavy duty tools to the selection of tools they sell. Sales and contribution margin from heavy duty tools is expected to be $100,000 and $30,000 respectively. The stores will have to be remodeled at a cost of $15,000 and new shelves will have to be purchased at a cost of $4,000. A purchasing manager will have to be hired who specializes in heavy duty tools for $38,000.20% of the allocated fixed costs for the company will be allocated to heavy duty tools. Determine the change to FarmIt, Inc.'s current operating income of $50,000 if the line is added