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: Frozen Food Baked Goods Fresh Produce Sales $ 135,000 $ 120,000 $ 184,000 Cost of goods sold 119,000 88,000 128,000 SFS estimates that store support expenses, in total, are approximately 17% 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: Activity (cost driver) Frozen Food Baked Goods Fresh Produce Order processing (number of purchase orders) 9 47 104 Receiving (number of deliveries) 10 59 132 Shelf-stocking (number of hours per delivery) 6 0.1 8 Customer support (total units sold) 26,000 32,000 64,000 The controller estimates activity-cost rates for each activity as follows: Order processing $ 84 per purchase order Receiving 105 per delivery Shelf-stocking 12.00 per hour Customer support 0.27 per item Required: 1. 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 (i.e. .2134 should be entered as 21.34%).) 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 (i.e. .2134 should be entered as 21.34%). Round your answers to nearest whole dollar.)

Required:

1.

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 (i.e. .2134 should be entered as 21.34%).)

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 (i.e. .2134 should be entered as 21.34%). Round your answers to nearest whole dollar.)