Variable and Absorption Costing-Three Products Winslow Inc. manufactures and sells three types of shoes. The income statements prepared under the absorption costing method for the three shoes are as f Winslow Inc. Product Income Statements-Absorption Costing For the Year Ended December 31, 20Y1 Cross Training Shoes Golf Shoes Running Shoes Revenues $338,500 $203,100 $172,600 Cost of goods sold 115,600 176,000 99,500 Gross profit $103,600 $162,500 $57,000 Selling and administrative expenses 139,800 74,600 95,200 $29,000 $(38,200) Income (loss) from operations $22,700 In addition, you have determined the following information with respect to allocated fixed costs: Cross Golf Running Training Shoes Shoes Shoes Fixed costs: $26,400 $24,200 Cost of goods sold $54,200 24,200 40,600 24,400 Selling and administrative expenses These fixed costs are used to support all three product lines. In addition, you have determined that the inventory is negligible. b. Prepare a variable costing income statement for the three products. Enter a net loss as a negative number using a minus sign; enter all other amounts as positive numbers Winlow Inc. Variable Costing Income Statements-Three Product Lines For the Year Ended December 31, 20Y1 Golf Shoes Cross Training Shoes Running Shoes Revenues 338,500 203.100 172600 Variable cost of goods sold Manfacturing margin Variable selling and administrative expenses Contribution margin Fxed costs: Fixed manufacturing costs Fixed selling and administrative expenses Total foxed costs Income from operations CUse the report in (b) to determine the profit impact of eliminating the running shoes line, assuming no other changes if the running shoes line were eliminated, then the contribution margin of the product line would be eliminated and the fixed costs would not be eliminated. Thus, the profit of the company would actually decline by reducing costs . Management should keep the line and attempt to improve the profitablity of the product by increasing prices, Increasing volume, or