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Members of the board of directors of Safety Systems have received the following operating income data for the year just ended: (Click the icon to
Members of the board of directors of Safety Systems have received the following operating income data for the year just ended: (Click the icon to view the operating income data.) Members of the board are surprised that the industrial systems product line is losing money. They commission a study to determine whether the company should discontinue the line. Data table ystems product line. er the two alternatives: (a) with the industrial systems line and (b) without the line. Compare the difference between the two alternatives' income numbers to come statement showing the decrease if the industrial systems line is discontinued. (Use parentheses or a minus sign for an operating loss.) your answer to Requirement 1 . What have you learned from this comparison? Safety Systems Total Analysis of Discontinuing a Product Line The operating income difference calculated on the total analysis of discontinuing a product line the expected decrease in operating income if Safety Systems discontinues the industrial systems product line, as shown in Requirement 1. This demonstrates that the incremental analysis approach in Requirement 1 yields results as the longer approach in Requirement 2 that compares total operating income under the two alternatives
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