Members of the board of directors of Security Systems have received the following Company accountants estimate that discontinuing the industrial systems line will operating income data for the year just ended: decrease fixed cost of goods sold by $81,000 and decrease fixed marketing and Click the icon to view the operating income data.) administrative expenses by $16,000 Members of the board are surprised that the industrial systems product line is Read the requirements losing money. They commission a study to determine whether the company should discontinue the line. Requirement 1. Prepare an incremental analysis to show whether Security Systems should discontinue the industrial systems product line. Incremental Analysis for Discontinuation Decision Total Contribution margin lost if Industrial Systems is discontinued Less: Fixed cost savings if Industrial Systems is discontinued Operating income if Industrial Systems is discontinued Choose from any list or enter any number in the input fields and then click Check Answer. A 1 | Security Systems 2 Product Line Contribution Margin Income Statement 3 For the Year Product lines Industrial Household Company 6 Systems Systems Total 7 Sales revenue $ 360,000 $ 370,000 $ 730,000 8 Less cost of goods sold: 9 Variable 38,000 41,000 79,000 10 Fixed 270,000 69,000 339,000 11 Gross profit $ 52,000 $ 260,000 $312,000 12 Less marketing and administrative expenses: 13 Variable 60,000 77,000 137,000 14 Fixed 42,000 26,000 68,000 15 Operating income (loss) $ (50,000 $ 157,000 $ 107,000 1. Prepare an incremental analysis to show whether Security Systems should discontinue the industrial systems product line. 2. Prepare contribution margin income statements to show Security Systems' 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