Exercise 7-7 (Algo) Segmented Income Statement [LO7-4]Shannon Company segments its income statement into its North and South Divisions. The company's overall sales, contribution marginratio, and net operating income are $960,000, 34%, and $19,200, respectively. The North Division's contribution margin andcontribution margin ratio are $121,600 and 38%, respectively. The South Division's segment margin is $140,800. The company has$211,200 of common fixed expenses that cannot be traced to either division.Required:Prepare an income statement for Shannon Company that uses the contribution format and is segmented by divisions. In addition, forthe company as a whole and for each segment, show each item on the segmented income statements as a percent of sales. (Roundyour percentage answers to 1 decimal place (i.e .1234 should be entered as 12.3).)Total CompanyNorth DivisionSouth DivisionAmount%Amount%Amount%

Answered: Shannon Company segments its income…

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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Shamrock Co. manufactures three types of computer desks. The income statement for the three products and the whole company is shown below: Sales Variable costs Fixed costs Total costs Operating income (loss) Product A Product B Product C $110,000 $135,000 75,000 125,000 $88,000 46,000 25,200 71,200 $16,800 18,000 93,000 $17,000 18,000 143,000 $(8,000) Total $333,000 246,000 61,200 307.200 $25,800 The company produces 1.000 units of each product. The company's capacity is 17,000 machine hours. The machine hours for each product are 7 hours for Product A, 5 hours for Product B, and 5 hours for Product C. Fixed costs are allocated based on machine hours.
Dukelow Corporation has two divisions: the Governmental Products Division and the Export Products Division. The Governmental Products Division's divisional segment margin is $37,300 and the Export Products Division's divisional segment margin is $89,700. The total amount of common fixed expenses not traceable to the individual divisions is $100,400. What is the company's net operating income (loss)? Multiple Choice $227,400 $127,000 $26,600 ($127,000)
Vishnu
The Commercial Division of Lobo Company has operating income of $12,680,000 and assets of $80,500,000. The minimum acceptable return on assets is 15%. What is the residual income for the division?
Cabell Products is a division of a major corporation. Last year the division had total sales of $11,440,000, net operating income of $686.400, and average operating assets of $2,402.400. The company's minimum required rate of return is 13%. The division's residual income is closest to: Multiple Cholce $686.400 $374.088 $(624.624) S998.712 65°F Cloudy to search DELL IT
Dukelow Corporation has two divisions: the Governmental Products Division and the Export Products Division. The Governmental Products Division's divisional segment margin is $39,800 and the Export Products Division's divisional segment margin is $92,200. The total amount of common fixed expenses not traceable to the individual divisions is $104,400. What is the company's net operating income (loss)? $236,400 $132,000 $27,600 ($132,000)
A company has four divisions. Division A has sales, variable expenses and traceable fixed expenses of 200,000, 103,000, 33,000, respectively. If the company as a whole has common fixed expenses of 50,000. What is division A’s segment Margin?
Corbel Corporation has two divisions: Division A and Division B. Last month, the company reported a contribution margin of $43,000 for Division A. Division B had a contribution margin ratio of 30% and its sales were $240,000. Net operating income for the company was $35,200 and traceable fixed expenses were $50,400. Corbel Corporation's common fixed expenses were:
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Davenport Incorporated has two divisions, Howard and Jones. The following is the segmented income statement for the past month: Howard Jones Total Sales revenue $ 800,000 $ 600,000 $ 1,400,000 Variable costs 400,000 480,000 880,000 Contribution margin $ 400,000 $ 120,000 $ 520,000 Direct fixed costs 200,000 100,000 300,000 Segment margin $ 200,000 $ 20,000 $ 220,000 Fixed costs (allocated) 150,000 150,000 300,000 Net operating income (loss) $ 50,000 $ (130,000) $ (80,000) What would Davenport's income (loss) be if the Jones Division was dropped?
Stryker corp. Has two major business segments- east and west. In April, the east business segment had sales revenue of 500,000, variable expenses of 280,000 and traceable fixed expenses of 80,000. During the same month, the west business segment had sales revenues of 970,000, variable expenses of 514,000 and traceable fixed expenses of 184,000. The common fixed expenses total 280,000 and were allocated as follows: 112,000 to the east business segment and 168,000 to the west business segment. A properly constructed segmented income statement in a contribution format would show that the segment margin of the east business segment is: 108,000 28,000 140,000 280,000
ABCDE Inc. has three divisions: AB, CD, and E. All fixed costs are unavoidable. Following is the income statement for the previous year: AB CD E Total Sales $ 515,000 $ 274,500 $ 226,000 $ 1,015,500 Variable Costs 182,000 124,500 100,500 407,000 Contribution Margin 333,000 150,000 125,500 608,500 Fixed Costs (allocated) 272,000 165,250 112,750 550,000 Profit Margin $ 61,000 $ (15,250 ) $ 12,750 $ 58,500 a. What would company’s profit margin be if the CD division were dropped?

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