What course of action do you recommend for each division? Division 1 Division 11 Prepare a columnar condensed income statement for Riverbed Company, assuming Division II is eliminated. Division II's unavoidable fixed costs are allocated equally to the continuing divisions. (If amount decreases net income then enter the amount using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) RIVERBED COMPANY CVP Income Statement Divisions III IV Sales $ Variable costs Cost of goods sold Selling and administrative Variable costs Cost of goods sold Selling and administrative Total variable costs Contribution margin Fixed costs Cost of goods sold Selling and administrative Total fixed costs Income (loss) from operations Riverbed Company has four operating divisions. During the first quarter of 2017, the company reported aggregate income from operations of $191,000 and the following divisional results. 1 Sales Cost of goods sold Selling and administrative expenses Income (loss) from operations $250,000 205,000 70,000 $25.000) Division 11 HII $198.000 $496,000 190,000 297,000 61,000 $(56,000) $138.000 IV $443,000 255.000 54.000 $134.000 64.000 Analysis reveals the following percentages of variable costs in each division, III 11 89 % 69 % 80 % Cost of goods sold Selling and administrative expenses IV 74 % 58 37 61 51 Discontinuance of any division would save 50% of the fixed costs and expenses for that division. Top management is very concerned about the unprofitable divisions (I and II). Consensus is that one or both of the divisions should be discontinued Compute the contribution margin for Divisions I and II. (Enter negative amounts using either a negative sign preceding the number eg.45 or parentheses es. (45).) Division 1 Division 11 Contribution margin S $ Prepare an incremental analysis concerning the possible discontinuance of Division I. (Round answers to decimal places, eg. 1525. If amount decreases net income then enter the amount using either a negative sign preceding the number eg.-45 or parentheses es. (451) Net Income Increase (Decrease) Continue Eliminate Contribution margin $ $ $ Fixed costs Cost of goods sold Selling and administrative Total fixed expenses Income (loss) from operations $ Prepare an incremental analysis concerning the possible discontinuance of Division II. (Round answers to decimal places, eg. 1525. If amount decreases net income then enter the amount using either a negative sign preceding the number eg.-45 or parentheses eg. (450) Net Income Increase (Decrease) Continue Eliminate Contribution margin $ $ Fixed costs Cost of goods sold Selling and administrative Total fixed expenses Income (loss) from operations $ What course of action do you recommend for each division? Division 1 Division 11 Prepare a columnar condensed income statement for Riverbed Company, assuming Division II is eliminated. Division II's unavoidable fixed costs are allocated equally to the continuing divisions. (If amount decreases net income then enter the amount using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) RIVERBED COMPANY CVP Income Statement Divisions III IV Sales $ Variable costs Cost of goods sold Selling and administrative Variable costs Cost of goods sold Selling and administrative Total variable costs Contribution margin Fixed costs Cost of goods sold Selling and administrative Total fixed costs Income (loss) from operations Riverbed Company has four operating divisions. During the first quarter of 2017, the company reported aggregate income from operations of $191,000 and the following divisional results. 1 Sales Cost of goods sold Selling and administrative expenses Income (loss) from operations $250,000 205,000 70,000 $25.000) Division 11 HII $198.000 $496,000 190,000 297,000 61,000 $(56,000) $138.000 IV $443,000 255.000 54.000 $134.000 64.000 Analysis reveals the following percentages of variable costs in each division, III 11 89 % 69 % 80 % Cost of goods sold Selling and administrative expenses IV 74 % 58 37 61 51 Discontinuance of any division would save 50% of the fixed costs and expenses for that division. Top management is very concerned about the unprofitable divisions (I and II). Consensus is that one or both of the divisions should be discontinued Compute the contribution margin for Divisions I and II. (Enter negative amounts using either a negative sign preceding the number eg.45 or parentheses es. (45).) Division 1 Division 11 Contribution margin S $ Prepare an incremental analysis concerning the possible discontinuance of Division I. (Round answers to decimal places, eg. 1525. If amount decreases net income then enter the amount using either a negative sign preceding the number eg.-45 or parentheses es. (451) Net Income Increase (Decrease) Continue Eliminate Contribution margin $ $ $ Fixed costs Cost of goods sold Selling and administrative Total fixed expenses Income (loss) from operations $ Prepare an incremental analysis concerning the possible discontinuance of Division II. (Round answers to decimal places, eg. 1525. If amount decreases net income then enter the amount using either a negative sign preceding the number eg.-45 or parentheses eg. (450) Net Income Increase (Decrease) Continue Eliminate Contribution margin $ $ Fixed costs Cost of goods sold Selling and administrative Total fixed expenses Income (loss) from operations $