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iPad + 9:35 PM ? mathsl.com Apple Bing Google Yahoo Google 55% . ww AMC Dine-.. AE Denim... 941 E 26th.... Plus Size...Assignme.. Do Hom... S2018 PI ACCT 205 (? CRN 17531 Tey'arrah Jennngs 4/1/18 9:35 pM Homework: Chap 25 Short Term Decision Score: 0 of 1 pt P25-29B (similar to) 1 of4(1 complete) ? Hw Score: 2.27%, 0.09 of 4 pts Question Heo * Members of the boand of directors of Secunity Team have received the following operating ncome data for the year ended May 31, 2018 ?(Cick the icon to view the opera ing income data.) Members of the board are surprised that the industrial systems product line is not prof tatle. They commission a study to determine whether the company shoukd drop the line. Company accountants estimate that dropping industrial systems will decrease fxed cost of goods sold by $82,000 and decrease fxed seling and administrative expenses by $10.000. Read the requirements Requirement 1. Prepare a diferenial analysis to show whether Security Team should drop the industriel systems product ine. (Use parentheses or a minus sgn lo enter decreases to profits) Expected decrease in revenues Expected decrease in total variable costs ncrease in fixed costs Expected decrease in total oosts Expected decrease in operating incomeExplanation / Answer
Statement Showing Differential Analysis Particular Amount Amount Expected Decrease in Revenue $310,000 Expected Decrease in Total Variable Cost ($40000+$65000) $105,000 Expected Increase in Fixed Cost ($82000+$10000) $92,000 Expected Decrease in Total Cost $197,000 $197,000 Expected decrease in Operating Income -$113,000
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