Mombers of the board of directors of Security Force 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 discontinue the line Company accountants estimate that discontinuing the industrial systems in wil decrease foed cost of goods sold by S77,000 and decrease fed marketing and administrative expenses by $8.000 Read the requirements Requirement 1. Prepare an incremental analysis to show whether Security Force should discontinue the industrial systems product Incremental Analysis for Discontinuation Decision Contribution margin lost if Industrial Systems is discontinued Less: Fixed cost savings if Industrial Systems is discontinued Operating income Industrial Systems is discontinued Requirement 2. Prepare contribution margin income statements to show Security Force's total operating income under the two alternatives. (a) with the industrial systems line and it without the line Compare the difference between the two tomatives'income numbers to your answer to Requirement 1. What have you came from this comparison? Begin by preparing the statements with and without the industrial systems line, then prepare the contribution margin income statement showing the decrease if the industrial systems line is discontinued. (Use arentheses or a minus sign for an operating loss.) i Data Table Product lines Industrial Household Company Systems Systems Total 280,000 $ 390,000 S 670,000 $ Sales revenue Less cost of goods sold: Variable 33,000 260,000 46,000 61,000 79,000 321,000 Fixed (13,000) $ 283,000 $ 270,000 Gross profit Less marketing and administrative expenses: Variable 60,000 44,000 71,000 24,000 131,000 68,000 Fixed (117,000) $ 188,000 $ 71,000 Operating income (loss) Print Done to Members of the board of directors of Security Force 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 discontinue the line Company accountants estimate that discontinuing the industrial systems line will decr e goods sold by $77,000 and decrease fixed marketing and administrative expenses by 58.000 Read the requirements Security Force Total Analysis of Discontinuing a Product Line Totals With Industrial Systems Totals Without Industrial Systems a Sales revenue Variable expenses Cost of goods sold Marketing and administrative expense Total variable expenses Choose from any list or enter any number in the input fields and then continue to the next question Company accountants estimate that discontinuing the industrial systems line will decreased goods sold by $77.000 and decrease fed marketing and administrative expenses by 58.000 cost of Members of the board of directors of Security Force 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 discontinue the line Read the requirements Cost of goods sold Marketing and administrative expense Total War expenses Contribution margin Fixed expense Cost of goods sold Marketing and administrative expense Total food expenses Operating income (5) come data for Company accoun t that continuing the industrial od by S77000 and decreased mating and cost of by 18.000 Members of the board of drectors of Security Force havered the following ring the year anded B lick the icon to view the operating income data) Members of the board are surprised that the industrial systems product in so mon commission a study to determine whether the company should discontinue the line Fixed expenses Cost of goods sold Marketing and administrative expense Total fixed expenses Operating income foss) What have you learned from this comparison? The operating income difference calculated on the total analysis of discontinuing a product line equals the expected decrease in operating income il Security Force discontinues the industrial systems product line, as shown in Requirement1 This demonstrates that the incremental analysis approach in Requirement B is the same results as e same results as the longer proach in Requirement that compares total operating income under the two alternatives