last years net operating income of $33,400 is considered unsatisfactory.

Home Meals On House- Total Nursing Wheels keeping $ 926,000 $265,000 $ 406,000 $ 255,000 477,000 118,000 204,000 155,000 449,000 147,000 202,000 100,000 Revenues Variable expenses Contribution margin Fixed expenses: Depreciation Liability insurance Program administrators' salaries General administrative overhead Total fixed expenses Net operating income (loss) 70,500 8,800 41,000 20,700 43,900 20,900 7,400 15,600 116,000 40,800 39,000 36,200 185,200 53,000 81,200 51,000 415,600 123,500 168,600 123,500 $ 33, 400 $ 23,500 $ 33,400 $(23,500) *Allocated on the basis of program revenues. The depreciation in housekeeping is for a small van that is used to carry the housekeepers and their equiprent from job to job. If the program were discontinued, the van would be donated to a charitable organization. None of the general administrative overhead would be avoided If the housekeeping program were dropped, but the liabilty Insurance and the salary of the program administrator would be avoided. Required: 1-a. What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? 1-b. Based on the financial advantage (disadvantage) of discontinuing the Housekeeping program calculated in requirement Req 1A, should the Housekeeping program be discontinued? 2-a. Prepare a properly formatted segmented income statement. 2-b. Would a segmented Income statement format be more useful to management in assessing the long-run financial viability of the various services