#1 and 2 please

Keep.or-Drop for Service Form, Complementary Effects, Traditional Analysis Devem Assurance Company provides both property and automobile insurance. The projected income statements for the two produtts are as follows: Property Automobile Insurance Insurance Sales 54,200,000 $12,000,000 9,000,000 Less variable expenses 3,830,000 $370,000 $2.400,000 500,000 400,000 Contribution margin Less direct fixed expenses Segment margin Less common fixed expenses (allocated) $(30,000) $1,900,000 100,000 200,000 Operating income (oss) $(130,000) $1,700,000 The president of the company is considering dropping the property Insurance. However, some policyholders prefer having their property and automobile insurance with the same company, so if property Insurance is dropped, sales of automobile Insurance will drop by 12 percent. No significant non-unit-level active costs are incurred Required: 1. if Devern Assurance Company drops property insurance, by how much will income increase or decrease? by As a supporting computation, prepare a segmented income statement for the keep-or-drop decision Devern Assurance Company Keep-or-Drop For Service Firm Segmented Income Statement Devern Assurance Company Keep-or-Drop For Service Firm Segmented Income Statement Keep Drop 2. Assume that dropping all advertising for the property insurance line and increasing the corporate advertising budget by 5450,000 will increase sales of property insurance by 10 percent and automobile insurance by 8 percent. Prepare a segmented income statement that reflects the effect of increased advertising Devern Assurance Company Keep-or-Drop For Service Firm Segmented Income Statement Property Insurance Automobile Insurance Total