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 drop the line. Company accountants estimate that dropping industrial systems will decrease fixed cost of goods sold by $78,000 and decrease fixed marketing and administrative expenses by $12,000. Requirements 1. Prepare an incremental analysis to show whether Safety Systems should drop the industrial systems product line. 2. Prepare contribu) fon margin income statements to show Safety Systems' total operating incomf 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. What have you learned from this comparison? More info Safety Systems Incremental Analysis of Dropping a Product Line Expected decrease in revenues: Dropping industrial systems sales Expected decrease in expenses: Variable expenses: Cost of goods sold Marketing and administrative expenses Fixed expenses: Cost of goods sold Marketing and administrative expenses Expected decrease in total expenses Expected decrease in operating income 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 drop the line. Company accountants estimate that dropping industrial systems will decrease fixed cost of goods sold by $78,000 and decrease fixed marketing and administrative expenses by $12,000. Requirements 1. Prepare an incremental analysis to show whether Safety Systems should drop the industrial systems product line. 2. Prepare contribu) fon margin income statements to show Safety Systems' total operating incomf 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. What have you learned from this comparison? More info Safety Systems Incremental Analysis of Dropping a Product Line Expected decrease in revenues: Dropping industrial systems sales Expected decrease in expenses: Variable expenses: Cost of goods sold Marketing and administrative expenses Fixed expenses: Cost of goods sold Marketing and administrative expenses Expected decrease in total expenses Expected decrease in operating income