A condensed income statement for the Electronics Division of Gihbli Industries Inc. for the year ended December 31 is as follows: $2,380,000 1,649,600 $ 730,400 421,000 $309,400 $1,700,000 Assume that the Electronics Division received no charges from service departments Sales Cost of goods sold Gross profit Operating expenses Income from operations Invested assets The president of Gihbli Industries Inc. has indicated that the division's return on a $1,700,000 investment must be increased to at least 20.8% by the end o the next year if operations are to continue. The division manager is considering the following three proposals: Proposal 1: Transfer equipment with a book value of $340,000 to other divisions at no gain or loss and lease similar equipment. The annual lease payments would be less than the amount of depreciation expense on the old equipment by $61,200. This decrease in expense would be included as part of the cost of goods sold. Sales would remain unchanged Proposal 2: Reduce invested assets by discontinuing a product line. This action would eliminate sales of $361,300, reduce cost of goods sold by $241,400, and reduce operating expenses by $106,300. Assets of $860,700 would be transferred to other divisions at no gain or loss. Proposal 3: Purchase new and more efficient machinery and thereby reduce the cost of goods sold by $224,400 after considering the effects of depredation expense on the new equipment. Sales would remain unchanged, and the old machinery, which has no remaining book value, would be scrapped at no gain or loss. The new machinery would increase invested assets by $850,000 for the year Required: PrevinnS