I need help with Req 6 & 7 only Please don't provide image based answer..thanku Toxaway Company is a merchandiser that segments its business into two divisions-Commercial and Residential. The company'saccounting intern was asked to prepare segmented income statements that the company's divisional managers could use to calculatetheir break-even points and make decisions. She took the prior month's companywide income statement and prepared the absorptionformat segmented income statement shown below:SalesCost of goods sold.Gross marginSelling and administrative expensesNet operating incomeIn preparing these statements, the intern determined that Toxaway's only variable selling and administrative expense is a 10% salescommission on all sales. The company's total fixed expenses include $72,000 of common fixed expenses that would continue to beincurred even if the Commercial or Residential segments are discontinued, $70,000 of fixed expenses that would disappear if theCommercial segment is dropped, and $48,000 of fixed expenses that would disappear if the Residential segment is dropped.Required:1. Do you agree with the intern's decision to use an absorption format for her segmented income statement?2. Based on a review of the intern's segmented income statement.a. How much of the company's common fixed expenses did she allocate to the Commercial and Residential segments?b. Which of the following three allocation bases did she most likely used to allocate common fixed expenses to the Commercial andResidential segments: (a) sales, (b) cost of goods sold, or (c) gross margin?3. Do you agree with the intern's decision to allocate the common fixed expenses to the Commercial and Residential segments?4. Redo the intern's segmented income statement using the contribution format.5. Compute the companywide break-even point in dollar sales.6. Compute the break-even point in dollar sales for the Commercial Division and for the Residential Division.Req 17. Assume the company decided to pay its sales representatives in the Commercial and Residential Divisions a total monthly salary of$21,000 and $42,000, respectively, and to lower its companywide sales commission percentage from 10% to 5%. Calculate the newbreak-even point in dollar sales for the Commercial Division and the Residential Division.Complete this question by entering your answers in the tabs below.Req 2ABreak-even pointTotal Company Commercial$ 900,000579,000321,000280,000$ 41,000Req 2B$ 300,000153,000147,000124,000$ 23,000Req 3CommercialDivisionResidentialDivisionResidential$ 600,000426,000174,000156,000$ 18,000Req 4Req 5Compute the break-even point in dollar sales for the Commercial Division and for the Residential Division. (Round CM ratio to2 decimal places and final answe to the ne whole dollar amount.)Req 6Req 7 Complete this question by entering your answers in the tabs below.Req 1Break-even pointReq 2AReq 1SalesVariable expenses:Req 7Assume the company decided to pay its sales representatives in the Commercial and Residential Divisions a total monthlysalary of $21,000 and $42,000, respectively, and to lower its companywide sales commission percentage from 10% to 5%.Calculate the new break-even point in dollar sales for the Commercial Division and the Residential Division. (Round CM ratio to2 decimal places and final answers to the nearest whole dollar amount.)Req 2ACost of goods soldSales commissionsReq 2BTotal variable expensesContribution marginTraceable fixed expensesSegment marginCommon fixed expensesCommercialDivisionNet operating incomeReq 3ResidentialDivisionReq 2BReq 3Redo the intern's segmented income statement using the contribution format.Toxaway CompanyIncome Statement$Req 4579,00090,00041,000Req 4TotalCompany$ 900,000 $ 300,000 $ 600,000669,000231,000118,000113,000 $72,000Req 5< Req 3Commercial Residential153,00030,000Req 6Req 5183,000117,00070,00047,000 $426,00060,000486,000114,00048,00066,000Req 5 >Req 6Show less AReq 7

Contribution margin is defined as the portion of revenue left with an entity after it has disbursed…

Toxaway Company is a merchandiser that segments its business into two divisions-Commercial and Residential. The company's accounting intern was asked to prepare segmented income statements that the company's divisional managers could use to calculate their break-even points and make decisions. She took the prior month's companywide income statement and prepared the absorption format segmented income statement shown below: Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income. In preparing these statements, the intern determined that Toxaway's only variable selling and administrative expense is a 10% sales commission on all sales. The company's total fixed expenses include $72,000 of common fixed expenses that would continue to be incurred even if the Commercial or Residential segments are discontinued, $70,000 of fixed expenses that would disappear if the Commercial segment is dropped, and $48,000 of fixed expenses that would disappear if the Residential segment is dropped. Required: 1. Do you agree with the intern's decision to use an absorption format for her segmented income statement? 2. Based on a review of the intern's segmented income statement. Req 1 a. How much of the company's common fixed expenses did she allocate to the Commercial and Residential segments? b. Which of the following three allocation bases did she most likely used to allocate common fixed expenses to the Commercial and Residential segments: (a) sales, (b) cost of goods sold, or (c) gross margin? 3. Do you agree with the intern's decision to allocate the common fixed expenses to the Commercial and Residential segments? 4. Redo the intern's segmented income statement using the contribution format. 5. Compute the companywide break-even point in dollar sales. 6. Compute the break-even point in dollar sales for the Commercial Division and for the Residential Division. 7. Assume the company decided to pay its sales representatives in the Commercial and Residential Divisions a total monthly salary of $21,000 and $42,000, respectively, and to lower its companywide sales commission percentage from 10% to 5%. Calculate the new break-even point in dollar sales for the Commercial Division and the Residential Division. Complete this question by entering your answers in the tabs below. Req 2A Break-even point Total Company Commercial $ 900,000 $ 300,000 579,000 153,000 321,000 280,000 $ 41,000 Req 2B 147,000 124,000 $ 23,000 Req 3 Commercial Division Residential Division Residential $ 600,000 426,000 174,000 156,000 $ 18,000 Req 4 Req 5 Compute the break-even point in dollar sales for the Commercial Division and for the Residential Division. (Round CM ratio to 2 decimal places and final answers to nearest whole dollar amount.) Req 6 Req 7