Homework: ACC-260 Topic 5 Assignment Save Score: 0 of 40 pts 5 of 5 (3 complete) HW Score: 33.14%, 33.14 of 100 pts P25-23A (similar to) Question Help 0 Members of the board of directors of Safe Zone have received the following operating income data for the year ended May 31, 2018: (Click the icon to view the operating income data.) Members of the board are surprised that the industrial systems product line is not profitable. They commission a study to determine whether the company should drop the line Company accountants estimate that dropping incustrial systems will decrease fixed cost of goods sold by $80,000 and decrease fixed selling and administrative expenses by $12.000 Read the requirements Data Table Requirement 1. Prepare a differential analysis to show whether Safe Zone should crop the industrial systems product line. (Use Safe Zone Income Statement For the Year Ended May 31, 2018 Product Line Industrial Household Systems Systems Total $ 310,000 $ 330,000 $ 640.000 in operating income Net Sales Revenue Cost of Goods Sold 0 Requirements Variable 36.000 220,000 46,000 64,000 82.000 284 000 Fixed 256,000 110,000 366.000 Total Cost of Goods Sold 54,000 220,000 274.000 1. Prepare a differential analysis to show whether Safe Zone should drop the industrial systems product line. 2. Prepare contribution margin income statements to show Safe Zone's total operating income under the two alternatives: (a) with the industrial systems line and (b) without the line. Compare the difference between the two alternatives' income numbers to your answer to Requirement 1. 3 What have you learned from the comparison in Requirement 2? Gross Profit Selling and Administrative Expenses Variable 81,000 38,000 71,000 22.000 132.000 60.000 Fixed 99,000 93,000 192.000 Print Done Total Selling and Administrative Expenses Operating Income (Loss) S (45,000) $ 127,000 $ 82,000 Print Done Choose from any list or enter any number in the input fields and then click Check Answer. 2 remaining Clear All Check