Variable and Absorption CostingThree ProductsFleet$-$of$-$Foot Inc. manufactures and sells three types of shoes. The income statements prepared under the absorption costing method for the three shoes are as follows:Fleet$-$of$-$Foot Inc.Product Income StatementsAbsorption CostingFor the Year Ended December $31$Line Item DescriptionCross Training ShoesGolf ShoesRunning ShoesRevenues$$12,000,000$ $$14,000,000$ $$9,000,000$ Cost of goods sold$(6,000,000)(7,000,000)(4,410,000)$Gross profit$$6,000,000$ $$7,000,000$ $$4,590,000$ Selling and administrative expenses$(6,240,000)(3,500,000)(3,200,000)$Operating income$$(240,000)$$$3,500,000$ $$1,390,000$ In addition, you have determined the following information with respect to allocated fixed costs:Line Item DescriptionCross Training ShoesGolf ShoesRunning ShoesFixed costs: Cost of goods sold$$1,800,000$$$1,400,000$$$1,710,000$Selling and administrative expenses$1,440,000700,000900,000$These fixed costs are used to support all three product lines and will not change with the elimination of any one product. In addition, you have determined that the effects of inventory may be ignored.The management of the company has deemed the profit performance of the cross training shoe line as unacceptable. As a result, it has decided to eliminate the cross training shoe line. Management does not expect to be able to increase sales in the other two lines. However, as a result of eliminating the cross training shoe line, management expects the profits of the company to increase by $$240,000.$Question Content Areaa. Are managements decision and conclusions correct?Managements decision and conclusion are fill in the blank $1$ of $3.$ The profit fill in the blank $2$ of $3$ be improved because the fixed costs used in manufacturing and selling cross training shoes fill in the blank $3$ of $3$ be avoided if the line is eliminated