Members of the board of directors of Security Team 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 $83,000 and decrease fixed selling and administrative expenses by $12,000. Read the requirements Requirement 1. Prepare a differential analysis to show whether Security Team should drop the industrial systems product line. (Use parentheses or a minus sign to enter decreases to profits.) Expected decrease in revenues Expected decrease in total variable costs Expected increase in fixed costs - Expected increase in total costs Expected increase in operating income Choose from any list or enter any number in the input fields and then click Check Answer. 2 parts 2 remaining Clear All Final Check 0 Data Table Security Team Income Statement For the Year Ended May 31, 2018 Product Line Industrial Household Systems Systems Total $ 300,000 $ 370,000 $ 870,000 Net Sales Revenue Cost of Goods Sold: Variable 33,000 250,000 49,000 89,000 82.000 319,000 Fixed 283,000 118,000 401.000 17,000 252,000 260,000 Total Cost of Goods Sold Gross Profit Selling and Administrative Expenses: Variable Fixed 69,000 40,000 109,000 (92,000) $ 78,000 27.000 103,000 149,000 $ 145,000 67.000 212,000 57,000 Total Selling and Administrative Expenses Operating Income (Loss) Print Done 0 Requirements - X 1. Prepare a differential analysis to show whether Security Team should drop the industrial systems product line. 2. Prepare contribution margin income statements to show Security Team'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. 3. What have you learned from the comparison in Requirement 2? Print Done