Members of the board of directors of Security FirstSecurity First have received the following operating income data for the year ended May 31, 2018:

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 the fixed cost of goods sold by $84,000 and decrease fixed selling and administrative expenses by $11,000

Requirement 2. Prepare contribution margin income statements to show

Security First'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. (Use parentheses or a minus sign for an operating loss )

Members of the board of directors of Security First 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 $84,000 and decrease fixed selling and administrative expenses by $11,000. Read the requirements. Requirement 1. Prepare a differential analysis to show whether Security First should drop the industrial systems product line. (Usc parentheses or a minus sign to enter decreases to profits.) Expected decrease in revenues $ (350,000) Expected decrease in total variable costs $ 101.000 Expected decrease in fixed costs 95,000 Expected decrease in total costs 196,000 $ (154.000) Expected decrease in operating income Requirement 2. Prepare contribution margin income statements to show Security First's lolal operating income under the two allematives: (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. (Use parentheses or a minus sign for an operating loss.) Security First Contribution Margin Income Statement For the Year Ended May 31, 2018 Totals With Totals Without Industrial Systems Industrial Systems Change if Industrial Systems Is Dropped Net Sales Revenue Members of the board of directors of Security First 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 $84,000 and decrease fixed selling and administrative expenses by $11,000. Read the requirements, Contribution Margin Income Statement For the Year Ended May 31, 2018 Totals With Totals Without Industrial Systems Industrial Systems Change if Industrial Systems Is Dropped Nel Sales Revenue Variable Costs: Manufacturing Selling and Administrative Total Variable Costs Contribution Margin Fixed Costs: Manufacturing Selling and Administrative Total Fixed Costs Operating Income (Loss) Enter any number in the edit fields and then click Check Answer. O Data Table - X Security First Income Statement For the Year Ended May 31, 2018 Product Line Industrial Household Systems Systems Total $ 350,000 $ 360,000 $ 710,000 Net Sales Revenue Cost of Goods Sold: Variable Fixed 33,000 230,000 263,000 42,000 68,000 110,000 75,000 298,000 373,000 Total Cost of Goods Sold Gross Profit 87,000 250,000 337,000 Selling and Administrative Expenses: Variable 68,000 39,000 Fixed 72,000 140,000 29,000 68,000 101,000 208,000 149,000 $ 129,000 Total Selling and Administrative Expenses 107,000 (20,000) $ $ Operating Income (Loss) Print Done