Business, 16.04.2020 04:45 josephvaldez518

Members of the board are surprised that the industrial systems product line is losing money. They commission a study to determine whether the company should discontinue the line. Company accountants estimate that discontinuing the industrial systems line will decrease fixed cost of goods sold by $80,000 and decrease fixed marketing and administrative expenses by $11,000. Requirements Prepare an incremental analysis to show whether Security Alliance should discontinue the industrial systems product line. Prepare contribution margin income statements to show Security Alliance’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?

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Members of the board are surprised that the industrial systems product line is losing money. They co...

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