4 Supermart Food Stores (SFS) has experienced net operating losses in its frozen food products line in the last few periods.Management believes that the store can improve its profitability If SFS discontinues frozen foods. The operating results from the mostrecent period are:Order processingReceivingShelf-stockingCustomer supportFrozen Foods$ 135,000119,000salesCost of goods soldSFS estimates that store support expenses, In total, are approximately 17% of revenues.The controller says that not every sales dollar requires or uses the same amount of store support activities. A preliminary analysisreveals store support activities for these three product lines are:Baked Goods$ 120,00088,000Activity (cost driver)Order processing (number of purchase orders)Receiving (number of deliveries)Shelf-stocking (number of hours per delivery)Customer support (total units sold)The controller estimates activity-cost rates for each activity as follows:$84 per purchase order105per deliveryper hourper itemRequired 1 Required 212.000.27Fresh Produce$ 184,000128,000Operating income (loss)Operating margin (loss)FrozenFoods910626,000%Required:1. Prepare a product-line profitability report for SFS under the current costing system.2. Prepare a product-line profitability report for SFS using the ABC Information the controller provides.Complete this question by entering your answers in the tabs below.BakedGoods47590.132,000Prepare a product-line profitability report for SFS under the current costing system. (Loss amounts should be indicated by aminus sign. Round operating margin (loss) to 2 decimal places (i.e. 0.2134 should be entered as 21.34%).)Frozen FoodBaked GoodsFresh Produce%FreshProduce104132864,000%

Product Line Profitability report calculates the total amount of profit gained from all products…

Supermart Food Stores (SFS) has experienced net operating losses in its frozen food products line in the last few periods. Management believes that the store can improve its profitability if SFS discontinues frozen foods. The operating results from the most recent period are: Sales Cost of goods sold Frozen Foods $ 135,000 119,000 Baked Goods $ 120,000 $8,000 Fresh Produce $ 184,000 128,000