The division manager of Division B received the following operating income data for the past? year:

The division manager of Division B received the following operating income data for the past​ year:

Division B of Deisel, Inc.

Income Statement

For the Year Ended December 31, 2018

Product Line

T205

B179

Total

Net Sales Revenue

$370,000

$390,000

$760,000

Cost of Goods Sold:

Variable

41,000

39,000

80,000

Fixed

250,000

68,000

318,000

Total Cost of Goods Sold

291,000

107,000

398,000

Gross Profit

79,000

283,000

362,000

Selling and Administrative Expenses:

Variable

61,000

76,000

137,000

Fixed

56,000

20,000

76,000

Total Selling and Administrative Expenses

117,000

96,000

213,000

Operating Income (Loss)

$(38,000)

$187,000

$149,000

2a. Prepare a differential analysis to show whether Division B should drop the T205 product line. ​(Enter decreases to profits with a parentheses or minus​ sign.)

 

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