Top managers of Video Street 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 foved costs will not change if the company stops selling DVDs Read the requirements Requirement 1. Prepare a differential analysis to show whether Video Street should drop the DVD product line Begin by preparing a differential analysis to show whether Video Street 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 Expected in operating income Decision They are considering dropping the DVD product line Company accountants have prepared the following analysis to help make Top managers of Video Street are alarmed by the operating this decision (Click the loon to view the analysis) Total fixed costs will not change if the company stops selling DVDs Read the requirements APLU Expected decrease in costs-Dropping DVDs Expected in operating income Decision Requirement 2. W dropping DVDs add 534,000 to operating income? Explain to conclude that dropping the DVD product line would add $34,000 to operating income, the company drops the DVD productie, the DVDs incurfed expenses allocated to Choose from any list or enter any number in the input fields and then continue to the next question i Data Table Total Blu-ray Discs 300,000 $ 150,000 DVD Discs 126,000 100,000 Net Sales Revenue 426,000 $ 250,000 176,000 150,000 26,000 Variable Costs Contribution Margin Fixed Costs: Manufacturing Selling and Administrative Total Fixed Expenses Operating Income (Loss) 123,000 66,000 50,000 10,000 73,000 56,000 129,000 21,000 S 189,000 60,000 (34,000) (13,000) 5 Print Done i Requirements 1. Prepare a differential analysis to show whether Video Street should drop the DVD product line. 2. Will dropping DVDs add $34,000 to operating income? Explain. Print Done