Question

02:57:40 Vulcan Company Income Statement For the Month Ended June 30 Sales $900,000 Variable expenses 400,000 Contribution margin 492,000 Fixed expenses 465,000 Net operating $ 27,000 income Print Management is disappointed with the company's performance and is wondering what can be done to improve profits. By examining sales and cost records, you have determined the following: rn Territory. Fixed expensexed expenses are come and Tibs. Sales of a. The company is divided into two sales territories-Northern and Southern. The Northern Territory recorded $400,000 in sales and $168,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern Territory, Fixed expenses of $212,000 and $130,000 are traceable to the Northern and Southern Territories, respectively. The rest of the fixed expenses are common to the two territories. b. The company is the exclusive distributor for two products-Paks and Tibs. Sales of Paks and Tibs totaled $200,000 and $200,000, respectively, in the Northern territory during June. Variable expenses are 25% of the selling price for Paks and 59% for Tibs. Cost records show that $90,000 of the Northern Territory's forced expenses are traceable to Poks and $40,000 to Tibs, with the remainder common to the two products. Required: 1-a. Prepare contribution format segmented income statements for the total company broken down between sales territories. 1-b. Prepare contribution format segmented income statements for the Northern Territory broken down by product line. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Prepare contribution format segmented income statements for the total company broken down between sales territories. (Round your percentage answers to 1 decimal place (i.e. 0.1234 should be entered as 12.3).) Total Company Amount % Sales Territory Northern Southern Amount % Amount % 1 Reg 1A Reg 1B >

Answer 1

1a) Segmented income Statement for the Total Company Sales Territory Total Company Northren South Amount Amount Amount Sales Variabel Expenses Contribution Margin Traceable Fixed Expenses Territory segment Margin Common Fixed Cost Net operating Income 900000 100.0% 400000 100.0% 500000 100.0% 45.3% 168000 42.0% 240000 48.0% 54.7% 232000 58.0% 260000 52.0% 38.0% 212000 53.0% 130000 26.0% 5.0% 130000 26.0% 408000 492000 342000 150000 16.7% 20000 123000 13.7% 27000 3.0% 1b) Segmented income Statement for the Northren Territory Product Lines Northern Territory Paks Tibs Amount Amount Amount Sale 400000 100.0% 200000 100.0% 200000 100.0% Variabel Expenses Contribution Margin Traceable Fixed Expenses Product line Segment Margin common Fixed Cost Net operating Income 42.0% 50000 58.0% 150000 75.0% 82000 41.0% 32.5% 90000 25.5% 60000 20.5% 5.0% 25.0% 118000 59.0% 168000 232000 45.0% 40000 20.0% 130000 30.0% 42000 21.0% 102000 82000 20000