Safe and Secure, Inc. produces three models of home security systems. Information on the three products is given below: Sales Variable expenses Contribution margin Fixed expenses Net income Assurance Decoder Burglar Beware $457,500 $762,500 $303,500 228,750 305,000 212,450 228,750 457,500 91,050 179,500 348,300 142,200 $49,250 $109,200 $(51,150) Fixed expenses consist of $452,800 of common costs allocated to the three products based on relative sales, and additional fixed costs of $44,100 (Assurance), $120,000 (Decoder), and $53,100 (Burglar Beware). The common costs will be incurred regardless of how many models are produced. The other fixed expenses would be eliminated if a model is phased out. Matt Dillon, an executive with the company with extensive law enforcement background, feels that the Burglar Beware line should be discontinued to increase the company's net income. Compute current net income for Safe and Secure, Inc. (Enter loss using either a negative sign preceding the number e.3.-2,945 or parentheses e.. (2,945). Net income Compute net income by product line and in total for Safe and Secure, Inc, if the company discontinues the Burglar Beware product line. (Hint Allocate the $452,800 common costs to the two remaining product lines based on their relative sales.) (Enter loss using either a negative sin preceding the numbere 8.-2945 or parentheses es. (2,9451) Assurance Decoder Company Total Net income $ e Textbook and Media Should Safe and Secure, Inc., eliminate the Burglar Beware product line? Why or why not? 4. the total for the company is when the Burglar Beware product line is included. e Textbook and Media Assume instead that fixed expenses consist of $144,350 of common costs allocated to the three products equally, and additional fixed costs of $128,900 (Assurance) $295,500 (Decoder), and $ 101,250 (Burglar Beware). The common costs will be incurred regardless of how many models are produced. The other fixed expenses would be eliminated if a model is phased out. Compute net income by product line and in total for Safe and Secure, Inc. If the company discontinues Burglar Beware product line. Should Safe and Secure, Inc., eliminate the burglar Beware product line? Why or why not Enter loss using alternatives preceding the number 2.945 or parenthede.(2.9450 Should Safe and Secure, Inc., eliminate the Burglar Beware product line? Why or why not? 4. the total for the company is when the Burglar Beware product line is included. e Textbook and Media Assume instead that fixed expenses consist of $144,350 of common costs allocated to the three products equally, and additional fixed costs of $128,900 (Assurance) $295,500 (Decoder), and $101,250 (Burglar Beware). The common costs will be incurred regardless of how many models are produced. The other fixed expenses would be eliminated if a model is phased out. Compute net income by product line and in total for Safe and Secure, Inc., if the company discontinues Burglar Beware product line. Should Safe and Secure, Inc., eliminate the Burglar Beware product line? Why or why not? (Enter loss using either a negative sign preceding the number eg.-2.945 or parentheses e.. (2.9451) Assurance Decoder Company Total Net Income $ the total net income for the company is when the Burglar Beware product line is included. higher lower same e Textbook and Media
