Studemeir Paint & Floors (SPF) is a retail store specializing in home improvement. The store has experienced net operating losses in its Other Flooring Products line during the last few periods. SPF's management team thinks that the store will improve its profitability if it stops carrying the Other Flooring Products line. The operating results from the most recent period are: Paint and Other Paint Flooring Supplies Carpet Products $ 252,300 $ 222,900 $ 178,900 150,000 166,000 142,250 Sales Cost of goods sold SPF estimates that store operating expenses are approximately 25% of revenues. Harish Rana, SPF's controller, states that while every sale has one purchase order, not every sales dollar requires or uses the same amount of store support activities. He conducts a preliminary investigation and his results and analysis are as follows: Activity (cost driver) Order processing (number of purchase orders) Receiving (number of deliveries) Customer support (hours required per sale) Paint and Paint Supplies 432 54 0.30 Carpet 113 112 8.0 Other Flooring Products 112 65 0.70 Harish estimates activity-cost rates for each activity as follows: Order processing Receiving Customer support $ 150 per purchase order 185 per delivery per hour 20 Required: 1. Prepare a product-line profitability report for SPF under the current costing system. 2. Prepare a product-line profitability report for SPF using the ABC information the controller provides. Required 1 Required 2 Prepare a product-line profitability report for SPF under the current costing system. (Loss amounts should be indi minus sign. Round operating margin (loss) to 2 decimal places (i.e. 0.2134 should be entered as 21.34%).) Paint & Paint Supplies Carpet Other Flooring Products 0 $ 0 $ 0 Operating income (loss) Operating margin (loss) % % % Required Required 2 > Required 1 Required 2 Prepare a product-line profitability report for SPF using the ABC information the controller provides. (Loss amounts indicated by a minus sign. Round operating margin (loss) to 2 decimal places (i.e. 0.2134 should be entered as 21. Round all other answers to nearest whole dollar.) Paint & Paint Supplies Carpet Other Flooring Products 0 $ 0 $ 0 Store support: 0 0 0 Total store support Operating income (loss) Operating margin (loss) % % %