Sales Rhinebeck Company Product-Line Income Statement For the Month Ended October 31 Cost of goods sold Gross profit Selling and administrative expenses Operating income (loss) Hats Gloves Mufflers $64,000 $89,700 $26,100 (26,000) (33,100) (14,300) $38,000 $56,600 $11,800 (29,900) (35,100) (15,600) $8,100 $21,500 $(3,800) Fixed costs are 16% of the cost of goods sold and 40% of the selling and administrative expenses. Rhinebeck Company assumes that fixed costs would not be materially affected if the Gloves line were discontinued. a. Prepare a differential analysis dated October 31 to determine if Mufflers should be continued (Alternative 1) or discontinued (Alternative 2). If an amount is zero, enter "0". If required, use a minus sign to indicate a loss. Differential Analysis Continue (Alt. 1) or Discontinue (Alt. 2) Mufflers October 31 Continue Discontinue Mufflers Differential Revenues Costs: Variable cost of goods sold Variable selling and admin. expenses Fixed costs Profit (Loss) Mufflers Effects (Alternative 1) (Alternative 2) (Alternative 2) 26,100 12,012 15,599 X 0000 0000