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 $1,170,000, 48%, and $23, 400, respectively. The North Division's contribution margin and contribution margin ratio are $202, 800 and 52%, respectively. The South Division's segment margin is $226, 200. The company has $339, 300 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.
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 $1,170,000, 48%, and $23, 400, respectively. The North Division's contribution margin and contribution margin ratio are $202, 800 and 52%, respectively. The South Division's segment margin is $226, 200. The company has $339, 300 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.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text: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 $1, 170, 000, 48%, and $23, 400, respectively.
The North Division's contribution margin and contribution margin ratio are $202, 800 and 52%, respectively. The South Division's segment margin is $226, 200. The company has $339, 300 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.
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