Requirement 1. Prepare a differential analysis to show whether Security FirstSecurity First should drop the industrial systems product line. (Use parentheses or a minus sign to enter decreases to profits.)

Members of the board of directors of Security FirstSecurity First have received the following operating income data for the year ended May 31, 2018:

Members of the board are surprised that the industrial systems product line is not profitable. They commission a study to determine whether the company should drop the line. Company accountants estimate that dropping industrial systems will decrease the fixed cost of goods sold by $84,000 and decrease fixed selling and administrative expenses by $11,000.

For the Year Ended May 31, 2018 Product Line Industrial Household Systems Systems Total $ 350,000 $ 360,000 $ 710,000 Net Sales Revenue Cost of Goods Sold: Variable 33,000 230,000 42,000 68,000 75,000 298,000 Fixed 263,000 110,000 373,000 Total Cost of Goods Sold Gross Profit Selling and Administrative Expenses: 87,000 250,000 337,000 Variable Fixed 68,000 39,000 107,000 (20,000) $ 72,000 140,000 29,000 68,000 101,000 208,000 149,000 $ 129,000 Total Selling and Administrative Expenses $ Operating Income (Loss) P25-23A (similar to) Question Help O Members of the board of directors of Security First have received the following operating income data for the year ended May 31, 2018: (Click the icon to view the operating income data.) Members of the board are surprised that the industrial systems product line is not profitable. They commission a study to determine whether the company should drop the line. Company accountants estimate that dropping industrial systems will decrease fixed cost of goods sold by $84.000 and decrease fixed selling and administrative expenses by $11.000. Read the requirements Requirement 1. Prepare a differential analysis to show whether Security First should drop the industrial systems product line. (Use parentheses or a minus sign to enter decreases to profits.) Expected decrease in revenues Expected decrease in total variable costs Expected decrease in fixed costs Expected decrease in total costs Expected decrease in operating income Choose from any list or enter any number in the input fields and then click Check Answer. parts 2 remaining Clear All Check