Members of the board of directors of Control One 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 industrial systems will decrease fixed cost of goods sold by $82,000 and decrease fixed selling and administrative expenses by $11,000. Read the requirements - X Requirement 1. Prepare a differential analysis to show whether Control One should drop the industrial systems product line. (Use parentheses or a minus sign to enter decreases to profits.) Data Table Control One in operating income Income Statement For the Year Ended May 31, 2018 Product Line Industrial Household Systems Systems Total $ 300,000 $ 360,000 $ 660,000 Net Sales Revenue Cost of Goods Sold: Requirements Variable 40.000 49,000 66,000 89,000 296.000 230.000 Fixed 270,000 115,000 385,000 30,000 245,000 275,000 1. Prepare a differential analysis to show whether Control One should drop the industrial systems product line. 2. Prepare contribution margin income statements to show Control One'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? Total Cost of Goods Sold Gross Profit Selling and Administrative Expenses: Variable 62,000 45,000 70,000 22.000 132,000 67,000 Fixed 107,000 92,000 199,000 Total Selling and Administrative Expenses Print Done $ (77,000) $ 153,000 $ 76,000 Operating Income (Loss) Print Done Choose from any list or enter any number in the input fields and then click Check