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Gorman Nurseries Inc. grows poinsettias and fruit trees in a green house/nursery operation. The following information was provided for the coming year. Poinsettias Fruit Trees $970,000 $3,100,000 460,000 1,630,000 160,000 200,000 Sales Variable cost of goods sold Direct fixed overhead A sales commission of 4% of sales is paid for each of the two product lines. Direct fixed selling and administrative expense was estimated to be $146,000 for the poinsettia lin $87,000 for the fruit tree line. Common fixed overhead for the nursery operation was estimated to be $800,000; common selling and administrative expense was estimated to be $450,000. Required: Prepare a segmented income statement for Gorman Nurseries for the coming year, using variable costing. Note: Enter all amounts as positive numbers except operating loss, if applicable. Gorman Nurseries Inc. Segmented Income Statement For the Coming Year Line Item Description Less variable expenses: Contribution margin Less direct fixed expenses: Segment margin Less common fixed expenses: Poinsettias Fruit Trees Total DU DU

Gorman Nurseries Inc. grows poinsettias and fruit trees in a green house/nursery operation. The following information was provided for the coming year. Poinsettias Fruit Trees $970,000 $3,100,000 460,000 1,630,000 160,000 200,000 Sales Variable cost of goods sold Direct fixed overhead A sales commission of 4% of sales is paid for each of the two product lines. Direct fixed selling and administrative expense was estimated to be $146,000 for the poinsettia lin $87,000 for the fruit tree line. Common fixed overhead for the nursery operation was estimated to be $800,000; common selling and administrative expense was estimated to be $450,000. Required: Prepare a segmented income statement for Gorman Nurseries for the coming year, using variable costing. Note: Enter all amounts as positive numbers except operating loss, if applicable. Gorman Nurseries Inc. Segmented Income Statement For the Coming Year Line Item Description Less variable expenses: Contribution margin Less direct fixed expenses: Segment margin Less common fixed expenses: Poinsettias Fruit Trees Total DU DU

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Gorman Nurseries Inc. grows poinsettias and fruit trees in a green house/nursery operation. The following information was provided for the coming year. Poinsettias Fruit Trees $970,000 $3,100,000 460,000 1,630,000 160,000 200,000 Sales Variable cost of goods sold Direct fixed overhead A sales commission of 4% of sales is paid for each of the two product lines. Direct fixed selling and administrative expense was estimated to be $146,000 for the poinsettia line and $87,000 for the fruit tree line. Common fixed overhead for the nursery operation was estimated to be $800,000; common selling and administrative expense was estimated to be $450,000. Required: Prepare a segmented income statement for Gorman Nurseries for the coming year, using variable costing. Note: Enter all amounts as positive numbers except operating loss, if applicable. Gorman Nurseries Inc. Segmented Income Statement For the Coming Year Line Item Description Less variable expenses: Contribution margin Less direct fixed expenses: Segment margin Less common fixed expenses: Poinsettias Fruit Trees Total 1000 000 000 $
Transcribed Image Text:Gorman Nurseries Inc. grows poinsettias and fruit trees in a green house/nursery operation. The following information was provided for the coming year. Poinsettias Fruit Trees $970,000 $3,100,000 460,000 1,630,000 160,000 200,000 Sales Variable cost of goods sold Direct fixed overhead A sales commission of 4% of sales is paid for each of the two product lines. Direct fixed selling and administrative expense was estimated to be $146,000 for the poinsettia line and $87,000 for the fruit tree line. Common fixed overhead for the nursery operation was estimated to be $800,000; common selling and administrative expense was estimated to be $450,000. Required: Prepare a segmented income statement for Gorman Nurseries for the coming year, using variable costing. Note: Enter all amounts as positive numbers except operating loss, if applicable. Gorman Nurseries Inc. Segmented Income Statement For the Coming Year Line Item Description Less variable expenses: Contribution margin Less direct fixed expenses: Segment margin Less common fixed expenses: Poinsettias Fruit Trees Total 1000 000 000 $
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