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AudioMart is a retailer of radios, stereos, and televisions. The store carries two portable sound systems that have radios, tape players, and speakers, System A,

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AudioMart is a retailer of radios, stereos, and televisions. The store carries two portable sound systems that have radios, tape players, and speakers, System A, of slightly higher qualty than System B, costs $21 more. With rare exceptions, the store also sells a headset when a system is sold. The headset can be used with either system. Variable-costing income statements for the three products follow: "This includes common fixed costs totaling 417,900 , allecated to each product in proportion to its revenues. The owner of the ttore is concerned about the profit performance of 5ystem B and is considering dropping it. If the product is dropped, sales of 5y yem A will increase by 32%6, and sales of headsets wall drop by 26%. Round all answers to the nearest whole number Mequired: 1. Hrepare segmented income statements tor the three products. Round your answers to the negrest dollar fnout expenses as nositeve numbers. 2(a) Prepare segmented income statements for System A and the headsets aswuming that System B is dropped. Round your answers to the nearest dollar, input expenses as positive numbers. (Note: Be sure to complete z(b) belon the statement.) 2(a) Prepare segmented income statements for System A and the headsets assuming that System B is dropped. Round your answers to the nearest dollar. Input expenses positive numbers. (Notes. Be sure to complete 2(0) below the statement.) Exeinak - checkiop What increntect 2(b) mhould bystem B bo dropped? Suppose that a third systern, 5 ystem C, with a similar quality to System B, could be acquired. Assume that with C the sales of A would remain unchanged; however, C would produce only 80% of the revenues of B, and sales of the headsets would drop by 10%. The contribution margin ratio of C is 50%, and its direct fixed costs would be identical to those of B. 3(a) Prepare segmented income statements for System A,5ystemC and the headsets. Round your answers to the nearest dollar. Input expenses as positive numbers. (Note: Be sure to complete 3 (b) below the statement.)

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