Income Statements Segmented by Products
Clay Consulting Firm provides three types of client services in
three...
Income Statements Segmented by Products
Clay Consulting Firm provides three types of client services in
three health-care-related industries. The income statement for July
is as follows:
Clay Consulting Firm Income
Statement For Month of July
Sales
$900,000
Less Variable costs
(601,000)
Contribution Margin
299,000
Less fixed expenses
Service
70,000
Selling and administrative
65,000
(135,000)
Net income
$164,000
The sales, contribution margin ratios, and direct fixed expenses
for the three types of services are as follows:
Hospitals
Physicians
Nursing Care
Sales...
Segmented Income Statements, Adding and Dropping Product
Lines
Dantrell Palmer has just been appointed manager of...
Segmented Income Statements, Adding and Dropping Product
Lines
Dantrell Palmer has just been appointed manager of Kirchner
Glass Products Division. He has two years to make the division
profitable. If the division is still showing a loss after two
years, it will be eliminated, and Dantrell will be reassigned as an
assistant divisional manager in another division. The divisional
income statement for the most recent year is as follows:
Sales
$4,590,000
Less: Variable expenses
3,953,450
Contribution margin
$636,550
Less: Direct...
Segmented Income Statement
Gorman Nurseries Inc. grows poinsettias and fruit trees in a
green house/nursery operation....
Segmented Income Statement
Gorman Nurseries Inc. grows poinsettias and fruit trees in a
green house/nursery operation. The following information was
provided for the coming year.
Poinsettias
Fruit Trees
Sales
$970,000
$3,100,000
Variable cost of goods sold
460,000
1,630,000
Direct fixed overhead
160,000
200,000
A sales commission of 4% of sales is paid for each of the two
product lines. Direct fixed selling and administrative expense was
estimated to be $146,000 for the poinsettia line and $87,000 for
the fruit tree...
Structuring a Keep-or-Drop Product Line Problem with
Complementary Effects
Shown below is a segmented income statement...
Structuring a Keep-or-Drop Product Line Problem with
Complementary Effects
Shown below is a segmented income statement for Hickory
Company's three wooden flooring product lines:
Strip
Plank
Parquet
Total
Sales revenue
$400,000
$200,000
$300,000
$900,000
Less: Variable expenses
225,000
120,000
250,000
595,000
Contribution margin
$175,000
$ 80,000
$ 50,000
$305,000
Less direct fixed expenses:
Machine rent
(5,000)
(20,000)
(30,000)
(55,000)
Supervision
(15,000)
(10,000)
(5,000)
(30,000)
Depreciation
(35,000)
(10,000)
(25,000)
(70,000)
Segment margin
$120,000
$ 40,000
$ (10,000)
$150,000
Hickory's parquet flooring...
Exercise 6-7 Segmented Income Statement [LO6-4]
Shannon Company segments its income statement into its North and...
Exercise 6-7 Segmented Income Statement [LO6-4]
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 $490,000, 38%, and $9,800,
respectively. The North Division’s contribution margin and
contribution margin ratio are $100,800 and 42%, respectively. The
South Division’s segment margin is $35,000. The company has $68,600
of common fixed expenses that cannot be traced to either
division.
Required:
Prepare an income statement for Shannon Company that...
Exercise 6-7 Segmented Income Statement [LO6-4]
Shannon Company segments its income statement into its North and...
Exercise 6-7 Segmented Income Statement [LO6-4]
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 $660,000, 42%, and $13,200,
respectively. The North Division’s contribution margin and
contribution margin ratio are $119,600 and 46%, respectively. The
South Division’s segment margin is $64,000. The company has
$105,600 of common fixed expenses that cannot be traced to either
division.
Required:
Prepare an income statement for Shannon Company that...
Income Statements Segmented by Territory
Script, Inc., has two product lines. The September income
statements of...
Income Statements Segmented by Territory
Script, Inc., has two product lines. The September income
statements of each product line and the company are as follows:
SCRIPT, INC.
Product Line and Company Income Statements
For Month of September
Pens
Pencils
Total
Sales
$25,000
$30,000
$55,000
Less variable expenses
(10,000)
(12,000)
(22,000)
Contribution margin
15,000
18,000
33,000
Less direct fixed expenses
(8,000)
(6,000)
(14,000)
Product margin
$7,000
$12,000
$19,000
Less common fixed expenses
(6,000)
Net income
$13,000
Pens and pencils are sold...
Structuring a Keep-or-Drop Product Line Problem with
Complementary Effects
Shown below is a segmented income statement...
Structuring a Keep-or-Drop Product Line Problem with
Complementary Effects
Shown below is a segmented income statement for Hickory
Company's three wooden flooring product lines:
Strip
Plank
Parquet
Total
Sales revenue
$400,000
$200,000
$300,000
$900,000
Less: Variable expenses
225,000
120,000
250,000
595,000
Contribution margin
$175,000
$ 80,000
$ 50,000
$305,000
Less direct fixed expenses:
Machine rent
(5,000)
(20,000)
(30,000)
(55,000)
Supervision
(15,000)
(10,000)
(5,000)
(30,000)
Depreciation
(35,000)
(10,000)
(25,000)
(70,000)
Segment margin
$120,000
$ 40,000
$ (10,000)
$150,000
Hickory's management is...