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PR 21-5A Segment Variable Costing Income Statement and Errect on Operating Income of Change in Operations and large (L). The income sutement has contistently indicated a net loas for the M aite, and ropand the saln of siar 5 so that the entire plant capacity cas contine io be wied. If Froposal 2 is selected afid stae M is ditcontinued and production curtaled the amnual fied production coits and fwed operatinit expeiues could be reduced by $46000 and $32,240, sales volume it to also assumed that the increused production of Size 5 would utgite the plant faclities relessed by the diccontinuabee of sire M. The walei and costs bave been relatwely stable over the past few youn, and they are expectad to remain wo for the foresecoble fattere. The incrime statement for the past year eaded fase 30,20W. is as followr Instructions 1. Prepare an iscome statement for the pat your in the variable cotting fermat. Urat the following headines: operating income. Check Figurm Contribubon margin, Sine \$, \$2355,520 Prepocal 2 ir arceject sire If Proposal 2 is accepted: Contribution margin for Size M Less: Reduction in fixed production costs Reduction in fixed operating expenses \begin{tabular}{|r|r|} \hline$ & 46,080 \\ \hline & 32,240 \\ \hline \end{tabular} Roduction in annual operating income Valdespin Company Variable Costing income Statement For the Year Ended June 30, 20 Y9 3. 5.4. If Proposal 3 is accepted: Operating income, Proposal 3 Oporating income, present conditions (part 1) Increase in operating income \begin{tabular}{|l|l|} \hline$ & 132,726 \\ \hline & (85,790) \\ \hline$ & 46,936 \\ \hline \end{tabular} PR 21-5A Segment Variable Costing Income Statement and Errect on Operating Income of Change in Operations and large (L). The income sutement has contistently indicated a net loas for the M aite, and ropand the saln of siar 5 so that the entire plant capacity cas contine io be wied. If Froposal 2 is selected afid stae M is ditcontinued and production curtaled the amnual fied production coits and fwed operatinit expeiues could be reduced by $46000 and $32,240, sales volume it to also assumed that the increused production of Size 5 would utgite the plant faclities relessed by the diccontinuabee of sire M. The walei and costs bave been relatwely stable over the past few youn, and they are expectad to remain wo for the foresecoble fattere. The incrime statement for the past year eaded fase 30,20W. is as followr Instructions 1. Prepare an iscome statement for the pat your in the variable cotting fermat. Urat the following headines: operating income. Check Figurm Contribubon margin, Sine \$, \$2355,520 Prepocal 2 ir arceject sire If Proposal 2 is accepted: Contribution margin for Size M Less: Reduction in fixed production costs Reduction in fixed operating expenses \begin{tabular}{|r|r|} \hline$ & 46,080 \\ \hline & 32,240 \\ \hline \end{tabular} Roduction in annual operating income Valdespin Company Variable Costing income Statement For the Year Ended June 30, 20 Y9 3. 5.4. If Proposal 3 is accepted: Operating income, Proposal 3 Oporating income, present conditions (part 1) Increase in operating income \begin{tabular}{|l|l|} \hline$ & 132,726 \\ \hline & (85,790) \\ \hline$ & 46,936 \\ \hline \end{tabular}

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