Members of the board of directors of

Security ForceSecurity Force

have received the following operating income data for the year just ended:

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. Company accountants estimate that discontinuing industrial systems will decrease fixed cost of goods sold by

$ 79 comma 000$79,000

and decrease fixed marketing and administrative expenses by

$ 15 comma 000$15,000.

Requirements

1.	Prepare an incremental analysis to show whether Security ForceSecurity Force should discontinue the industrial systems product line.
2.	Prepare contribution margin income statements to show Security Force'sSecurity Force'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. What have you learned from this comparison?