Top managers of Entertainment Plus are alarmed by their operating losses. They are considering dropping the DVD product line. Company accountants have prepared the following analysis to help make this decision: (Click the icon to view the analysis.) Total fixed costs will not change if the company stops selling DVDS. Read the requirements. Requirement 1. Prepare a differential analysis to show whether Entertainment Plus should drop the DVD product line. Begin by preparing a differential analysis to show whether Entertainment Plus should drop the DVDS product line. (Enter decreases to profits with a parentheses or minus sign.) Expected decrease in revenues-Dropping DVDS Expected decrease in costs-Dropping DVDS |in operating income Expected Decision: Requirement 2. Will dropping DVDS add $34,000 to operating income? Explain. to conclude that dropping the DVD product line would add $34,000 to operating income. If the company drops the DVD product line, it incur fixed expenses allocated to the DVDS It is - X Data Table Entertainment Plus Income Statement For the Year Ended December 31, 2018 Blu-ray DVD Total Discs Discs Net Sales Revenue 425,000 $ 300,000 $ 125,000 251,000 159,000 92,000 Variable Costs Contribution Margin 174,000 141,000 33,000 Fixed Costs: Manufacturing 123,000 69,000 54,000 89,000 56,000 13,000 Selling and Administrative 192,000 125,000 67,000 Total Fixed Expenses (18,000) $ 16,000 $ (34,000) Operating Income (Loss) Print Done - X Requirements 1. Prepare a differential analysis to show whether Entertainment Plus should drop the DVD product line 2. Will dropping DVDS add $34.000 to operating income? Explain Print Done