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Exercise 13-14A (Algo) Segment elimination decision LO 13-4 Benson Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. Segment Sales Cost of goods sold Sales commissions Contribution margin General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) Net income (loss) BENSON COMPANY Income Statements for Year 2 Complete this question by entering your answers in the tabs below. Required A Required B Prepare a schedule of relevant sales and costs for Segment A. Relevant Rev. and Cost items for Segment A Sales Effect on income Required a. Prepare a schedule of relevant sales and costs for Segment A. b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A. Required A A $ 171,000 (128,000) (18,000) Required B > B $246,000 (91,000) (27,000) 25,000 128,000 (39,000) (42,000) (7,000) (13,000) $ (21,000) $ 73,000 с $258,000 (82,000) (22,000) 154,000 (27,000) 0 $127,000

Exercise 13-14A (Algo) Segment elimination decision LO 13-4 Benson Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. Segment Sales Cost of goods sold Sales commissions Contribution margin General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) Net income (loss) BENSON COMPANY Income Statements for Year 2 Complete this question by entering your answers in the tabs below. Required A Required B Prepare a schedule of relevant sales and costs for Segment A. Relevant Rev. and Cost items for Segment A Sales Effect on income Required a. Prepare a schedule of relevant sales and costs for Segment A. b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A. Required A A $ 171,000 (128,000) (18,000) Required B > B $246,000 (91,000) (27,000) 25,000 128,000 (39,000) (42,000) (7,000) (13,000) $ (21,000) $ 73,000 с $258,000 (82,000) (22,000) 154,000 (27,000) 0 $127,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Exercise 13-14A (Algo) Segment elimination decision LO 13-4 Benson Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. Segment Sales Cost of goods sold Sales commissions Contribution margin General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) Net income (loss) BENSON COMPANY Income Statements for Year 2 Complete this question by entering your answers in the tabs below. Required A Required B Prepare a schedule of relevant sales and costs for Segment A. Relevant Rev. and Cost items for Segment A Sales Effect on income Required a. Prepare a schedule of relevant sales and costs for Segment A. b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A. Required A A $ 171,000 (128,000) (18,000) Required B > B $246,000 (91,000) (27,000) 25,000 128,000 (39,000) (42,000) (7,000) (13,000) $ (21,000) $ 73,000 с $258,000 (82,000) (22,000) 154,000 (27,000) 0 $127,000
Transcribed Image Text:Exercise 13-14A (Algo) Segment elimination decision LO 13-4 Benson Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. Segment Sales Cost of goods sold Sales commissions Contribution margin General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) Net income (loss) BENSON COMPANY Income Statements for Year 2 Complete this question by entering your answers in the tabs below. Required A Required B Prepare a schedule of relevant sales and costs for Segment A. Relevant Rev. and Cost items for Segment A Sales Effect on income Required a. Prepare a schedule of relevant sales and costs for Segment A. b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A. Required A A $ 171,000 (128,000) (18,000) Required B > B $246,000 (91,000) (27,000) 25,000 128,000 (39,000) (42,000) (7,000) (13,000) $ (21,000) $ 73,000 с $258,000 (82,000) (22,000) 154,000 (27,000) 0 $127,000
Required A Required B Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A. BENSON COMPANY Comparative Income Statements for the Year 2 Keep Seg. A Decision Sales Cost of goods sold Sales commissions Contribution margin General fixed operating expenses Advertising expense Net Income Eliminate Seg. A < Required A Required B
Transcribed Image Text:Required A Required B Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A. BENSON COMPANY Comparative Income Statements for the Year 2 Keep Seg. A Decision Sales Cost of goods sold Sales commissions Contribution margin General fixed operating expenses Advertising expense Net Income Eliminate Seg. A < Required A Required B
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