Sunshine Services is a nonprofit organization devoted to providing essential services to seniors who live in their own homes within Southern California. Three services are provided for seniors-home nursing, Meals On Wheels, and housekeeping. Data on revenue and expenses for the past year follow: Revenues Variable expenses Contribution margin Fixed expenses: Depreciation Liability insurance Program administrators' salaries General administrative overhead* Total fixed expenses Net operating income (loss) *Allocated on the basis of program revenues. Home Meals On House- Total Nursing Wheels keeping $919,000 $265,000 $403,000 $251,000 472,000 116,000 199,000 157,000 447,000 149,000 204,000 94,000 69,700 8,700 40,800 20,200 43,700 20,400 7,900 15,400 113,400 40,200 38,100 35,100 183,800 53,000 80,600 50,200 410,600 122,300 167,400 120,900 $ 36,400 $ 26,700 $ 36,600 $(26,900) The head administrator of Sunshine Services, Patsy Pearsall, considers last year's net operating income of $36,400 to be unsatisfactory; therefore, she is considering the possibility of discontinuing the housekeeping program. The depreciation in housekeeping is for a small van that is used to carry the housekeepers and their equipment from job to job. If the program were discontinued, the van would be donated to a charitable organization. None of the general administrative overhead would be avoided if the housekeeping program were dropped, but the liability insurance and the salary of the program administrator would be avoided. Required: 1-a. What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? 1-b. Based on the financial advantage (disadvantage) of discontinuing the Housekeeping program calculated in requirement Req 1A, should the Housekeeping program be discontinued? Complete this question by entering your answers in the tabs below. Req 1A Req 1B What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? Program administrators' salaries General administrative overhead* Total fixed expenses Net operating income (loss) *Allocated on the basis of program revenues. Saved Help S 113,400 40,200 38,100 35,100 183,800 53,000 80,600 50,200 410,600 122,300 167,400 120,900 $ 36,400 $ 26,700 $ 36,600 $(26,900) The head administrator of Sunshine Services, Patsy Pearsall, considers last year's net operating income of $36,400 to be unsatisfactory; therefore, she is considering the possibility of discontinuing the housekeeping program. The depreciation in housekeeping is for a small van that is used to carry the housekeepers and their equipment from job to job. If the program were discontinued, the van would be donated to a charitable organization. None of the general administrative overhead would be avoided if the housekeeping program were dropped, but the liability insurance and the salary of the program administrator would be avoided. Required: 1-a. What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? 1-b. Based on the financial advantage (disadvantage) of discontinuing the Housekeeping program calculated in requirement Req 1A, should the Housekeeping program be discontinued? Complete this question by entering your answers in the tabs below. Req 1A Req 1B Based on the financial advantage (disadvantage) of discontinuing the Housekeeping program calculated in requirement Req 1A, should the Housekeeping program be discontinued? Yes ONO