Safe and Secure, Inc. produces three models of home security systems. Information on the three products is given below:

		Assurance		Decoder		Burglar Beware
Sales		$447,900		$746,500		$296,900
Variable expenses		223,950		298,600		207,830
Contribution margin		223,950		447,900		89,070
Fixed expenses		178,600		344,700		143,700
Net income		$45,350		$103,200		$(54,630	)

Fixed expenses consist of $450,400 of common costs allocated to the three products based on relative sales, and additional fixed costs of $44,200 (Assurance), $120,800 (Decoder), and $51,600 (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 companys net income.

Compute current net income for Safe and Secure, Inc. (Enter loss using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (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 $450,400 common costs to the two remaining product lines based on their relative sales)

	Assurance	Decoder	Company Total
Net Income $

Should Safe and Secure Inc. eliminate the Burglar Beware product line? Why or why not?