SegmentedIncome Statement; TV Cable Company
Countywide Cable Services, Inc. is organized with three segments: Metro, Suburban, and Outlying. Data for these segments for the year just ended follow.
| Metro | Suburban | Outlying |
Service revenue | $1.000,000 | $800,000 | $400,000 |
Variable expenses | 200,000 | 150,000 | 100,000 |
Controllable fixed expenses | 400,000 | 320,000 | 150,000 |
Fixed expenses controllable by others | 230,000 | 200.000 | 90,000 |
In addition to the expenses listed above, the company has $95,000 of common fixed expenses. Income-tax expense for the year is $145,000.
Required:
1. Prepare a segmented income statement for Countywide Cable Services, Inc. Use the contribution format.
2. Build aspreadsheet:Construct an Excel spreadsheet to solve the preceding requirement. Show how the solution will change if the following information changes: the sales revenues were $950.000 and $815.000 for Metro and Suburban, respectively.
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