Question

Prairie Electronics, located in Regina, manufactures three product lines: (1) high-end speakers, (2) personal computers, and (3) handheld devices. For 20X5, it compiled the following budgeted data High-End Speakers 420,000 Personal Handheld Devices Computers 630,000 Total Sales (in units) Price (per unit) Variable costs per unit Direct materials 520,000 1,500 $ 1,330 $ 455 360 130 120 70 80 410 110 70 50 60 $ $ 70 25 15 6 2 Direct labour Overhead Shipping Sales commissions Direct fixed costs: $ 85,610,000 $57,830,000 17,940,000 43,380,000 Salaries $ 80,100,000 Utilities 53,670,000 76,770,000 67,030,000 147,230,000 Depreciation Common fixed costs: Corporate salaries Building depreciation Legal & accounting Other $ 47,960,000 40,010,000 59,340,000 36,260,000 Required: 1. & 2. Prepare a segmented performance report, Compute the contribution margin percentage and segment margin percentage. (Round "Percentage" answers to 1 decimal place, (i.e., 0.123 should be considered as 12.3%).)

Answer 1

			High-End		Personal		Handheld		Total
			Speakers		Computers		Devices		company
sales revenue			630,000,000		837,900,000		236,600,000		1,704,500,000
less:	Variable costs
Direct materials			172,200,000		226,800,000		36,400,000		435,400,000
direct labor			46,200,000		81,900,000		13,000,000		141,100,000
overhead			29,400,000		75,600,000		7,800,000		112,800,000
shipping			21,000,000		44,100,000		3,120,000		68,220,000
Sales commission			25,200,000		50,400,000		1,040,000		76,640,000
Total variable expense			294,000,000		478,800,000		61,360,000		834,160,000
contribution margin			336,000,000		359,100,000		175,240,000		870,340,000
less:	Direct fixed costs
Salaries			80,100,000		85,610,000		57,830,000		223,540,000
utilities			53,670,000		67,030,000		17,940,000		138,640,000
Depreciation			76,770,000		147,230,000		43,380,000		267,380,000
total fixed expenses			210,540,000		299,870,000		119,150,000		629,560,000
Segment margin			125,460,000		59,230,000		56,090,000		240,780,000
less:	Common fixed costs
Corporate salaries									47,960,000
Building depreciation									40,010,000
legal & accounting									59,340,000
other									36,260,000
total common fixed costs									183,570,000
Net income									57,210,000
Conribution margin %			53.3%		42.9%		74.1%
Segment margin %			19.9%		7.1%		23.7%
			High-End		Personal		Handheld		Total
			Speakers		Computers		Devices		company
Segment margin			125,460,000		59,230,000		56,090,000		240,780,000
less:common fixed cots
Allocated portion			61190000		61190000		61190000		183570000
net income(loss)			64,270,000		(1,960,000)		(5,100,000)		57,210,000