Problem 7.40A a-d Ribeiro Manufacturing Company has four operating divisions. During the first quarter of 2020, the company reported aggregate income from operations of $154,900 and the following divisional results: Division I II III IV $505,800 $399,000 $308,900 $178,800 Cost of goods sold 284,000 246.500 272,600 155,400 Selling and administrative expenses 61.500 73.800 69.000 74,800 Income (loss) from operations $160,300 $78,700 $(32.700) $(51,400 The analysis reveals the following percentages of variable costs in each division: I Cost of goods sold Selling and administrative expenses 72% 42 II 88% 49 III 74% 65 IV 92% 70 Discontinuance of any division would save 50% of the fixed costs and expenses for that division Top management is very concerned about the unprofitable divisions (III and IV). The consensus is that the company should discontinue one or both of these divisions. Calculate the contribution margin for divisions III and IV. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Divisions III Divisions IV Contribution margin Prepare an incremental analysis for the possible discontinuance of (1) division III and (2) division IV. (Round answers to 0 decimal places, e.g. 125. Enter all negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) (1) Division III Income Increase (Decrease) Keep Div. III Shut Div. III Division III: Contribution margin Fixed costs Totals (2) Division IV Income Increase (Decrease) Division IV: Keep Div. TV Shut Div. IV Contribution margin Fixed costs Totals What course of action do you recommend for each division? Division III should be Division IV should be Prepare a condensed income statement in columns for Rber Manufacturing, assuming division Vi either a negative in preceding the number or parentheseseo (65) t ed. Use the format. Division IV unavoidable fed costs we located to the continuing divisions (Enter loss using RIBEIRO MANUFACTURING COMPANY CVP Income Statement Dil Diy II D TIL Total Contribution margin Foxed costs Net income (los) Variable costs from operations of $154,900 with the total income from operations without division Sales with Division Incremental income from eliminating Division IV Income from operations without Division IV Reconcile the total income from operations of $154.900 with the total income from operations without division IV. Income from operations with Division IV Incremental income from eliminating Division IV Income from operations without Division IV