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Supermart Food Stores (SFS) has experlenced net operating losses in Its frozen food products line in the last few perlods. Management belleves that the store
Supermart Food Stores (SFS) has experlenced net operating losses in Its frozen food products line in the last few perlods. Management belleves that the store can Improve Its profitability If SFS discontinues frozen foods. The operating results from the most recent perlod are: SFS estimates that store support expenses, In total, are approximately 14% of revenues. The controller says that not every sales dollar requires or uses the same amount of store support actlvitles. A prellminary analysis reveals store support actlvitles for these three product lines are: The controller estimates actlvity-cost rates for each actlvity as follows: Required: 1. Prepare a product-IIne profitabillty report for SFS under the current costing system. 2. Prepare a product-Ine profitability report for SFS using the ABC Information the controller provides. Complete this question by entering your answers in the tabs below. 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% ).)
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