Members of the board of directors of Security Check have received the followingoperating income data for the year ended May 31, 20242b. S441,000)SECURITY CHECKIncome StatementFor the Year Ended May 31, 2024Froduct LinendurtrialHouneholdSyrtemaSyrtemaTetalNet Sales Revenue$ 200,000Cont of Goods SoltVariable27,00047,000Fied200,0002,000222,000Tetal Cont of Goods Sold237,000110,000407,000Gram Profita,000270,000222,000Seling and Admiristratie tpenVariable6400072,000127,000Fied44,00070,000Tutal Seling and Administrative tpennOperting nme m1000S 17L000207,000S124,000Memben of the boand are wrprised tat the indatrial wysem prodact line is not profie-alle. They commisskon a ly o deermine wheher the company shoukd drop the line.Company accountams estimate that dropping indlnrial syotema will decrease fised cot ofgah wl by SJK0 and decrease fised seling and administrative espenses by $12J0.Requirements1. Prepare a differemial analysis to show whether Security Check should drop theindustrial systems product ine.2. Prepare contribuion margin income statements to show Security Check's totaloperating income under the wo ahernative: () with the industrial systema lineand (1) without the line, Compare the diiereaa between the rwo ahernativesincome numben to your ansuer to Requirement 1.

Name: Members of the board of directors of Security Check have received the
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Description: Members of the board of directors of Security Check have received the followingoperating income data for the year ended May 31, 20242b. S441,000)SECURITY CHECKIncome StatementFor the Year Ended May 31, 2024Froduct LinendurtrialHouneholdSyrtemaSyrtem

Differential analysis is done by businesses to decide a new product or to drop an existing product…

Business

Accounting

clon of Secunty Check have receved folowing perating income daa for the year ended May 31, 2024 2h. M41,0000 SECURITY CHEOK ncome Statement For the Year Ended May 31, 2024 Produst une ndutriel Syrtema Houehald yrtema Ttal Net Sales eveue Cntof Goods Sok Variale 7,000 Fied ,000 Tetal Cot of Goo eld 401,000 Grm haf ,000 Seling and Adminitratie tpen Verialle 71,000 27,000 7, 000 207, 000 Ped Tutal eling and Adminratie tpenn Opering me m 108,000 1000 14,000 Memlen of the lnl arepised d the indarl y prodet lne is ot prolie dile. They comminkna aly deermine wleder the company shnkl drop the ine. Campany aceuntas eimate that dropping inshaial sptems will derese fied co of a wal ly SKD and deree fied selling and alminitrive espenes by $12. Requirements 1. Prepare a dfierential analysis o shuw whether Neeurity Check should drop the indutrial sytems praluct ine. 2. Prepare contiluion margin income satements to show Security Check's soal operating income under the wo ahernative (0 with the industrial systems line and () without the line, Compare the dren between the rwo ahernatives

clon of Secunty Check have receved folowing perating income daa for the year ended May 31, 2024 2h. M41,0000 SECURITY CHEOK ncome Statement For the Year Ended May 31, 2024 Produst une ndutriel Syrtema Houehald yrtema Ttal Net Sales eveue Cntof Goods Sok Variale 7,000 Fied ,000 Tetal Cot of Goo eld 401,000 Grm haf ,000 Seling and Adminitratie tpen Verialle 71,000 27,000 7, 000 207, 000 Ped Tutal eling and Adminratie tpenn Opering me m 108,000 1000 14,000 Memlen of the lnl arepised d the indarl y prodet lne is ot prolie dile. They comminkna aly deermine wleder the company shnkl drop the ine. Campany aceuntas eimate that dropping inshaial sptems will derese fied co of a wal ly SKD and deree fied selling and alminitrive espenes by $12. Requirements 1. Prepare a dfierential analysis o shuw whether Neeurity Check should drop the indutrial sytems praluct ine. 2. Prepare contiluion margin income satements to show Security Check's soal operating income under the wo ahernative (0 with the industrial systems line and () without the line, Compare the dren between the rwo ahernatives

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter9: Metric-analysis Of Financial Statements

Section: Chapter Questions

Problem 9.4.5P: Twenty metrics of liquidity, solvency, and profitability The comparative financial statements of...

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