Millard Corporation is a wholesale distributor of office products. It purchases office products from manufacturers and distributes them in the West, Central, and East regions. Each of these regions is about the same size and each has its own manager and sales staff The company has been experiencing losses for many months. In an effort to improve performance, management has requested that the monthly income statement be segmented by sales region. The company's first effort at preparing a segmented income statement for May is given below. Sales Regional expenses (traceable): Cost of goods sold Advertising Salaries Utilities Depreciation Shipping expense Total regional expenses Regional income (toss) before corporate expenses Corporate expenses Advertising (general) General adsinistrative expense West $311,000 92,000 110,000 59,000 8,900 25,000 15,000 309,900 1,100 14,000 20,000 34,000 $ (32,500) Sales Region Central 5 800,000 245,000 245,000 59,000 15,500 33,000 28,000 625,500 41.000 20,000 61,000 East 1.698,000 313,000 237,000 112,000 13,900 26,000 43,000 744,900 30,000 20,000 38,000 $113,300 $ 104,900) Total corporate expenses Net operating income (Loss) The cost of goods sold and shipping expense are both variable. All other costs are fixed Required 3. Prepare a new contribution format segmented income statement for May (Round percentage answers to 1 decimal place.)
Millard Corporation is a wholesale distributor of office products. It purchases office products from manufacturers and distributes them in the West, Central, and East regions. Each of these regions is about the same size and each has its own manager and sales staff The company has been experiencing losses for many months. In an effort to improve performance, management has requested that the monthly income statement be segmented by sales region. The company's first effort at preparing a segmented income statement for May is given below. Sales Regional expenses (traceable): Cost of goods sold Advertising Salaries Utilities Depreciation Shipping expense Total regional expenses Regional income (toss) before corporate expenses Corporate expenses Advertising (general) General adsinistrative expense West $311,000 92,000 110,000 59,000 8,900 25,000 15,000 309,900 1,100 14,000 20,000 34,000 $ (32,500) Sales Region Central 5 800,000 245,000 245,000 59,000 15,500 33,000 28,000 625,500 41.000 20,000 61,000 East 1.698,000 313,000 237,000 112,000 13,900 26,000 43,000 744,900 30,000 20,000 38,000 $113,300 $ 104,900) Total corporate expenses Net operating income (Loss) The cost of goods sold and shipping expense are both variable. All other costs are fixed Required 3. Prepare a new contribution format segmented income statement for May (Round percentage answers to 1 decimal place.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Millard Corporation is a wholesale distributor of office products. It purchases office products from manufacturers and distributes them
in the West, Central, and East regions. Each of these regions is about the same size and each has its own manager and sales staff
The company has been experiencing losses for many months. In an effort to improve performance, management has requested that
the monthly income statement be segmented by sales region. The company's first effort at preparing a segmented income statement
for May is given below.
Sales
Regional expenses traceable):
Cost of goods sold
Advertising
Salaries
Utilities
Depreciation
Shipping expense
Total regional expenses
Regional income (less) before corporate expenses
Corporate expenses
Advertising (general)
General administrative expense
Mest
$311,000
92,000
110,000
59,000
8.900
25,000
15,000
309,900
1.100
14,000
20,000
34,000
5 (32,900)
Sales Region
Central
$800,000
245,000
245,000
59,000
15,500
33,000
28,000
hiso
2
East
1.698,000
Total corporate expenses
Net operating income (loss)
The cost of goods sold and shipping expense are both variable. All other costs are fixed
313,000
237,000
112,000
13,900
26,000
43,000
744,900
(46,900)
41,000
30,000
20,000
20,000
61,000
50,000
$113,500 $ (104,900)
Required:
3. Prepare a new contribution format segmented income statement for May (Round percentage answers to 1 decimal place.)
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