Requirement 1. Prepare an incremental analysis to show whether 123 Security should discontinue the industrial systems product line. Incremental Analysis for Discontinuation Decision Contribution margin lost if Industrial Systems is discontinued Total Less: Fixed cost savings if Industrial Systems is discontinued Operating income if Industrial Systems is discontinued Requirement 2. Prepare contribution margin income statements to show 123 Security's total operating income under the two alternatives: (a) with the industrial systems line and (b) without the line. Compare the difference between the two alternatives' income numbers to your answer to Requirement 1. What have you learned from this comparison? Begin by preparing the statements with and without the industrial systems line, then prepare the contribution margin income statement showing the decrease if the industrial systems line is discontinued. (Use parentheses or a minus sign for an operating loss.) 123 Security Total Analysis of Discontinuing a Product Line Sales revenue Variable expenses: Cost of goods sold Marketing and administrative expense Total variable expenses Contribution margin Fixed expenses: Cost of goods sold Marketing and administrative expense Total fixed expenses Totals With Industrial Systems Totals Without Industrial Systems Difference What have you learned from this comparison? The operating income difference calculated on the total analysis of discontinuing a product line This demonstrates that the incremental analysis approach in Requirement 1 yields the expected decrease in operating income if 123 Security discontinues the industrial systems product line, as shown in Requirement 1. results as the longer approach in Requirement 2 that compares total operating income under the two alternatives