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Supermart Food Stores (SFS) has experienced net operating losses in its frozen food products line in the last few periods. Management believes that the store

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Supermart Food Stores (SFS) has experienced net operating losses in its frozen food products line in the last few periods. Management believes that the store can improve its profitability if SFS discontinues frozen foods. The operating results from the most recent period are: Sales Cost of goods sold Frozen Foods $132,000 114,000 Fresh Baked Goods Produce $103,000 $182,000 76,000 128,000 SFS estimates that store support expenses, in total, are approximately 21% of revenues. The controller says that not every sales dollar requires or uses the same amount of store support activities. A preliminary analysis reveals store support activities for these three product lines are: Baked Fresh Activity (cost driver) Frozen Foods Goods Produce Order processing (number of purchase ordero) 48 101 Receiving (number of deliveries) 52 129 Shelf-stocking number of hours per delivery) 5 0.4 Customer support (total units sold) 24,000 32,000 64,000 The controller estimates activity-cost rates for each activity as follows: Order processing Receiving Shelt-stocking Customer support $ 79 per purchase order 109 por delivery 14.00 per hour 0.23 per item Required: 1. Prepare a product-line profitability report for SFS under the current costing system. 2. Prepare a product-line profitability report for SFS using the ABC information the controller provides Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a product-line profitability report for SFS under the current costing system. (Loss amounts should be indicated by a minus sign. Round operating margin (loss) to 2 decimal places (.e. 0.2134 should be entered as 21.34%).) Frozen Food Baked Goods Fresh Produce Operating income (loss) Operating margin (loss) % % Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a product-line profitability report for SFS using the ABC information the controller provides. (Loss amounts should be indicated by a minus sign. Round operating margin (loss) to 2 decimal places (.e. 0.2134 should be entered as 21.34%). Round all other answers to nearest whole dollar.) Frozen Food Baked Goods Fresh Produce Store support: Total store support cost Operating income (loss) Operating margin (loss) % %

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