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 Foods			Baked Goods			Fresh Produce
Sales	$	238,000		$	381,000		$	416,000
Cost of goods sold		221,000			308,000			321,000

SFS estimates that store support expenses, in total, are approximately 13% 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 Foods			Baked Goods			Fresh Produce
Order processing (number of purchase orders)		11			62			107
Receiving (number of deliveries)		13			75			254
Shelf-stocking (number of hours per delivery)		5			0.2			7
Customer support (total units sold)		27,000			38,000			76,000

The controller estimates activity-cost rates for each activity as follows:

Order processing	$	98	per purchase order
Receiving		112	per delivery
Shelf-stocking		20.00	per hour
Customer support		0.25	per item

Required:

1. Prepare a product-line profitability report for SFS under the current costing system.

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. 0.2134 should be entered as 21.34%).)

2. Prepare a product-line profitability report for SFS using the ABC information the controller provides.

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. 0.2134 should be entered as 21.34%). Round all other answers to nearest whole dollar.)2. Prepare a product-line profitability report for SFS using the ABC information the controller provides.

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. 0.2134 should be entered as 21.34%).) Frozen Food Baked Goods Fresh Produce $ 0 $ 0 $ 0 Operating income (loss) Operating margin (loss) % % % 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. 0.2134 should be entered as 21.34%). Round all other answers to nearest whole dollar.) Frozen Food Baked Goods Fresh Produce $ 0 S 0 $ 0 Store support 0 0 0 Total store support cost Operating income (loss) Operating margin (loss) % % %