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Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses as shown by its most recent monthly contribution format Income statement: Sales Variable expenses Contribution margin. Fixed expenses Net operating income (loss) In an effort to resolve the problem, the company wants to prepare an Income statement segmented by division. Accordingly, the Accounting Department provided the following information: Sales Variable expenses as a percentage of sales Traceable fixed expenses Req 1 $ 1,578,000 698,940 879,060 967,000 $ (87,940) Req 2A Req 28 Answer is not complete. Complete this question by entering your answers in the tabs below. Required: 1. Prepare a contribution format Income statement segmented by divisions. 2-a. The Marketing Department believes increasing the West Division's monthly advertising by $27,000 will increase that division's sales by 13%. Assuming these estimates are accurate, how much would the company's net operating Income Increase (decrease) if the proposal is Implemented? 2-b. Would you recommend the increased advertising? Sales Variable expenses Contribution margin Traceable fixed expenses Divisional segment margin Common fixed expenses not traceable to divisions Net operating loss East $ 358,000 48% $ 300,000 Prepare a contribution format income statement segmented by divisions. < Req 1 $ Division Central $ 650,000 39% $ 332,000 Total Company East $ 1,578,000 $ 358,000 698,940 879,060 879,060 879,060 358,000 $ 358,000 Req 2A > Division Central $ 650,000 650,000 West $570,000 $ 650,000 48% $ 209,000 West $ 570.000 570,000 $ 570,000

Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses as shown by its most recent monthly contribution format Income statement: Sales Variable expenses Contribution margin. Fixed expenses Net operating income (loss) In an effort to resolve the problem, the company wants to prepare an Income statement segmented by division. Accordingly, the Accounting Department provided the following information: Sales Variable expenses as a percentage of sales Traceable fixed expenses Req 1 $ 1,578,000 698,940 879,060 967,000 $ (87,940) Req 2A Req 28 Answer is not complete. Complete this question by entering your answers in the tabs below. Required: 1. Prepare a contribution format Income statement segmented by divisions. 2-a. The Marketing Department believes increasing the West Division's monthly advertising by $27,000 will increase that division's sales by 13%. Assuming these estimates are accurate, how much would the company's net operating Income Increase (decrease) if the proposal is Implemented? 2-b. Would you recommend the increased advertising? Sales Variable expenses Contribution margin Traceable fixed expenses Divisional segment margin Common fixed expenses not traceable to divisions Net operating loss East $ 358,000 48% $ 300,000 Prepare a contribution format income statement segmented by divisions. < Req 1 $ Division Central $ 650,000 39% $ 332,000 Total Company East $ 1,578,000 $ 358,000 698,940 879,060 879,060 879,060 358,000 $ 358,000 Req 2A > Division Central $ 650,000 650,000 West $570,000 $ 650,000 48% $ 209,000 West $ 570.000 570,000 $ 570,000

FINANCIAL ACCOUNTING
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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Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses as shown by its most recent monthly contribution format Income statement: Sales Variable expenses Contribution margin Fixed expenses Net operating income (loss) In an effort to resolve the problem, the company wants to prepare an income statement segmented by division. Accordingly, the Accounting Department provided the following information: Sales Variable expenses as a percentage of sales Traceable fixed expenses $ 1,578,000 698,940 879,060 967,000 $ (87,940) Sales Variable expenses Reg 2A Contribution margin Traceable fixed expenses Divisional segment margin Common fixed expenses not traceable to divisions Net operating loss East $ 358,000 Req 1 Req 28 Prepare a contribution format income statement segmented by divisions. 48% Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 $ 300,000 S Required: 1. Prepare a contribution format Income statement segmented by divisions. 2-a. The Marketing Department believes increasing the West Division's monthly advertising by $27,000 will increase that division's sales by 13%. Assuming these estimates are accurate, how much would the company's net operating Income increase (decrease) if the proposal is implemented? 2-b. Would you recommend the increased advertising? Division Central $ 650,000 Total Company East $ 1,578,000 $ 358,000 698,940 879,060 879,060 $ 332,000 879,060 358,000 39% $ 358,000 Req 2A > Division Central $ 650,000 650,000 West $ 570,000 $ 650,000 48% $ 209,000 West $ 570,000 570,000 $ 570.000
Transcribed Image Text:Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses as shown by its most recent monthly contribution format Income statement: Sales Variable expenses Contribution margin Fixed expenses Net operating income (loss) In an effort to resolve the problem, the company wants to prepare an income statement segmented by division. Accordingly, the Accounting Department provided the following information: Sales Variable expenses as a percentage of sales Traceable fixed expenses $ 1,578,000 698,940 879,060 967,000 $ (87,940) Sales Variable expenses Reg 2A Contribution margin Traceable fixed expenses Divisional segment margin Common fixed expenses not traceable to divisions Net operating loss East $ 358,000 Req 1 Req 28 Prepare a contribution format income statement segmented by divisions. 48% Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 $ 300,000 S Required: 1. Prepare a contribution format Income statement segmented by divisions. 2-a. The Marketing Department believes increasing the West Division's monthly advertising by $27,000 will increase that division's sales by 13%. Assuming these estimates are accurate, how much would the company's net operating Income increase (decrease) if the proposal is implemented? 2-b. Would you recommend the increased advertising? Division Central $ 650,000 Total Company East $ 1,578,000 $ 358,000 698,940 879,060 879,060 $ 332,000 879,060 358,000 39% $ 358,000 Req 2A > Division Central $ 650,000 650,000 West $ 570,000 $ 650,000 48% $ 209,000 West $ 570,000 570,000 $ 570.000
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