Rundle 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 RUNDLE COMPANY Income Statements for Year 2 Contribution margin General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) Net income (loss) $164,000 (122,000) (17,000) 25,000 (37,000) (4,000) $ (16,000) $ 106,000 $ 252,000 (72,000) (24,000) 156,000 (39,000) (11,000) $ 247,000 (91,000) (32,000) 124,000 (27,000) 0 $ 97,000 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

Rundle 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 RUNDLE COMPANY Income Statements for Year 2 Contribution margin General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) Net income (loss) $164,000 (122,000) (17,000) 25,000 (37,000) (4,000) $ (16,000) $ 106,000 $ 252,000 (72,000) (24,000) 156,000 (39,000) (11,000) $ 247,000 (91,000) (32,000) 124,000 (27,000) 0 $ 97,000 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

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter25: Departmental Accounting

Section: Chapter Questions

Problem 3CE

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Concept explainers

Overheads

In cost accounting, overhead refers to those expenses which occur during the operating of a business. Overhead includes the fixed, variable, or semi-variable which is not directly involved with a company product or service. It is very important to analyze overhead expense as it helps the company in determining how much a company must charge for its products and services so that they can generate profit. Overhead expenses depend upon the nature of the business operations.

Question

Please help me with all answers thanku

Rundle 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
RUNDLE COMPANY
Income Statements for Year 2
Contribution margin,
General fixed operating expenses (allocation of president's salary)
Advertising expense (specific to individual divisions)
Net income (loss)
Complete this question by entering your answers in the tabs below.
$164,000
(122,000)
(17,000)
25,000
(37,000)
(4,000)
$ (16,000)
Required A Required B
Prepare a schedule of relevant sales and costs for Segment A.
Relevant Revenue and Cost Items for Segment A
B
$ 252,000
(72,000)
(24,000)
156,000
(39,000)
(11,000)
$ 106,000
$ 247,000
(91,000)
(32,000)
124,000
(27,000)
0
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
$ 97,000

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
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 Revenue and Cost Items for Segment A
Effect on income
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 Required B
<RA
Complete this question by entering your answers in the tabs below.
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.
RUNDLE COMPANY
Comparative Income Statements for Year 2
Keep Segment
A
Decision
Sales
Cost of goods sold
Sales commissions
Required B >
Contribution margin
General fixed operating expenses
Advertising expense
Net income
Eliminate
Segment A
4

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