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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
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 proftability if SFS discontinues frozen foods. The operating resuits from the most recent period are: SFS estimates that store support expenses, In total, are approximately 20% of revenues. The controller says that not every sales dollar requires or uses the same amount of store support activites. A preliminary analyeis reveals store support activities for these three product lines are: The controller estimates activity-cost rates for each activity as follows: 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. Prepare a produet-line profitability report for SFS under the eurrent cesting 5ystem. (Loss amounts should be indicated by a minus sigh. Round operating margin (loss) to 2 decimal places ( 1 . .2134.5h0uld be entered as 21.34% )
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