Accounting

1. Prepare a differential analysis to show whether Movie Street should drop the DVD product line. (Use the worksheet below (Type Answers in Blue Cells Movie Street Income Statement For the Year Ended December 31, 2014 Blue-Ray DVD Total Discs Discs 408,000 S 308,000 $100,000 Sales Revenue S 254,000 S 158,000 96,000 Variable Costs 154,000 150,000 4,000 Contribution Margin Fixed Costs: S 135,000 S 77,000 IS 58,000 Manufacturing 74,000 IS 56,000 S 18,000 Selling and Administrative 209,000 IS 133,000 S 76,000 Total Fixed Expenses S (55,000) IS 17,000 S 72,000 Operating Income (Loss) Expected Decrease in Revenue Expected Decrease in total variable costs Expected change in operating income Yes or No? Should Movie Street Get eliminate the DVD Line? What is the Reason for your Choice