Shannon Company segments its income statement into its North and South Divisions. The company’s overall sales, contribution margin ratio, and net operating income are $480,000, 36%, and $9,600, respectively. The North Division’s contribution margin and contribution margin ratio are $92,000 and 40%, respectively. The South Division’s segment margin is $32,500. The company has $62,400 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, for the company as a whole and for each segment, show each item on the segmented income statements as a percent of sales. (Round your percentage answers to 1 decimal place (i.e .1234 should be entered as 12.3).) The image shows a table structured for financial data analysis across a company and its divisions. It is divided into two main sections: "Total Company" and "Divisions," which are further segmented into "North" and "South" divisions. Each section includes columns for "Amount" and "%." Here is a description of the table layout:### Table Layout- **Header Row:** - **Total Company:** - "Amount": Column for total financial amounts. - "%": Column for percentages representing total financial distribution. - **Divisions:** - **North:** - "Amount": Column for financial amounts specific to the North division. - "%": Column for percentages specific to the North division. - **South:** - "Amount": Column for financial amounts specific to the South division. - "%": Column for percentages specific to the South division.### RowsThe table contains several unnamed rows for entering data, likely representing different metrics or categories, such as revenue, expenses, profits, etc., though they are currently blank.### PurposeThis table can be used to organize and analyze financial data, allowing an educational user to compare and contrast the financial performance of each division against the overall company performance.

The divisional income statement is the financial statement that describes the financial performance…

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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Shannon Company segments its income statement into its North and South Divisions. The company’s overall sales, contribution margin ratio, and net operating income are $480,000, 36%, and $9,600, respectively. The North Division’s contribution margin and contribution margin ratio are $92,000 and 40%, respectively. The South Division’s segment margin is $32,500. The company has $62,400 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, for the company as a whole and for each segment, show each item on the segmented income statements as a percent of sales. (Round your percentage answers to 1 decimal place (i.e .1234 should be entered as 12.3).)

The image shows a table structured for financial data analysis across a company and its divisions. It is divided into two main sections: "Total Company" and "Divisions," which are further segmented into "North" and "South" divisions. Each section includes columns for "Amount" and "%." Here is a description of the table layout:

### Table Layout

- **Header Row:**
- **Total Company:**
- "Amount": Column for total financial amounts.
- "%": Column for percentages representing total financial distribution.
- **Divisions:**
- **North:**
- "Amount": Column for financial amounts specific to the North division.
- "%": Column for percentages specific to the North division.
- **South:**
- "Amount": Column for financial amounts specific to the South division.
- "%": Column for percentages specific to the South division.

### Rows
The table contains several unnamed rows for entering data, likely representing different metrics or categories, such as revenue, expenses, profits, etc., though they are currently blank.

### Purpose
This table can be used to organize and analyze financial data, allowing an educational user to compare and contrast the financial performance of each division against the overall company performance.

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