the condensed product-line income statement for Porcelain Tableware Company is as follows:

PORCELAIN TABLEWARE COMPANY Product-Line Income Statement
	Bowls			Plates			Cups
Sales	$650,000			$904,000			$274,000
Cost of goods sold	(257,000)			(319,000)			(144,000)
Gross profit	$393,000			$585,000			$130,000
Selling and administrative expenses	(287,000)			(352,000)			(149,000)
Operating income (loss)	$106,000			$233,000			$(19,000)

Fixed costs are 43% of the cost of goods sold and 13% of the selling and administrative expenses. Porcelain Tableware assumes that fixed costs would not be significantly affected if the Cups line were discontinued.

Question Content Area

a. Prepare a differential analysis report for all three products.

PORCELAIN TABLEWARE COMPANY Product Income Differential Analysis Report Bowls Plates Cups Differential revenue from monthly sales: Revenue from sales Differential costs of monthly sales: Variable cost of goods sold Variable selling and administrative expenses Monthly differential income from sales