Smith Company sells both designer and moderately priced fashion accessories. Top management is deciding which product line to emphasize. Accountants have provided the following data: E(Click the icon to view the data.) Prepare an analysis to show which product the company should emphasize. (Enter the units displayed per square foot and the contribution margin per square foot to two decimal places.) Data Table Product Designer Moderately Priced Units displayed per square foot: Per Item Designer Moderately Moderately priced Designer Priced Contribution margin per unit X X 195 $ $ Average sale price 82 Contribution margin per square foot of display space 105 20 Average variable costs Capacity-Square feet of display space X Average contribution margin 90 62 Total contribution margin at capacity 25 15 Average fixed costs (allocated) 65 $ $ 47 Average operating income The Smith Company store in Grand Junction, Colorado, has 14,000 square feet of floor space. If Smith Company emphasizes moderately priced goods, it can display 980 items in the store. If Smith Company emphasizes designer wear, it can only display 420 designer items. These numbers are also the average monthly sales in units. Enter any number in the edit fields and then click Check Answer. ? Assume that Video Street can avoid $45,000 of fixed costs by dropping the DVD product line (these costs are direct fixed costs of the DVD product line). Top managers of Video Street are alarmed by their operating losses. They are considering dropping the DVD product line. Company accountants have prepared the following analysis to help make this decision: (Click the icon to view the analysis.) Prepare a differential analysis to show whether Video Street should stop selling DVD.. (Enter decreases to revenues with a parentheses or minus sign.) Data Table Expected decrease in revenues Expected decrease in costs: Variable costs Video Street Fixed costs Income Statement Expected decrease in total costs For the Year Ended December 31, 2018 Expected in operating income Blu-ray DVD Total Discs Discs $ 304,000 $ 429,000 $ Net Sales Revenue 125,000 255,000 155,000 100,000 Variable Costs Contribution Margin 25,000 174,000 149,000 Fixed Costs: Manufacturing 71,000 129,000 58,000 66,000 56,000 10,000 Selling and Administrative 195,000 127,000 68,000 Total Fixed Expenses Choose from any list or enter any number in the input fields and then click Check Answer. ? $ 22,000 $ (21,000) $ (43,000) Operating Income (Loss) part remaining Clear All