ch Vulcan Company's contribution format income statement for June is as follows:Vulcan CompanyIncome StatementFor the Month Ended June 30SalesVariable expensesContribution marginFixed expensesNet operating income$ 900,000408,000492,000465,000$ 27,000Management wants to improve profits and gathered the following data:a. The company is divided into two sales territories-Northern and Southern. The Northern Territory recorded $400,000 in sales and$228,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern Territory.Fixed expenses of $168,000 and $130,000 are traceable to the Northern and Southern Territories, respectively. The rest of the fixedexpenses 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 $140,000 and $260,000,respectively, in the Northern territory during June. Variable expenses are 31% of the selling price for Paks and 71% for Tibs. Costrecords show $64,400 of the Northern Territory's fixed expenses are traceable to Paks and $52,000 to Tibs, with the remaindercommon to the two products.Required:1-a. Prepare contribution format income statements for the total company segmented by sales territories.1-b. Prepare contribution format income statements for the Northern Territory segmented by product line.

A Contribution Format Income Statement is a financial statement that presents information about an…

Answered: 1-a. Prepare contribution format income…

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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Vulcan Company's contribution format income statement for June is as follows: Vulcan Company Income Statement Sales Variable expenses Contribution margin Fixed expenses Net operating income For the Month Ended June 30 $750,000 336,000 414,000 378,000 $ 36,000 Management wants to improve profits and gathered the following data: a. The company is divided into two sales territories-Northern and Southern. The Northern territory recorded $300,000 in sales and $156,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern territory. Fixed expenses of $120,000 and $108,000 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 $50,000 and $250,000, respectively, in the Northern territory during June. Variable expenses are 22% of the selling price for Paks…
Vulcan Company's contribution format income statement for June is as follows: Vulcan Company Income Statement For the Month Ended June 30 Sales Variable expenses Contribution margin Fixed expenses Net operating income Management wants to improve profits and gathered the following data: a. The company is divided into two sales territories-Northern and Southern. The Northern Territory recorded $400,000 in sales and $220,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern Territory. Fixed expenses of $156,000 and $100,000 are traceable to the Northern and Southern Territories, respectively. The rest of the fixed expenses are common to the two territories. $ 800,000 300,000 500,000 475,000 $ 25,000 b. The company is the exclusive distributor for two products-Paks and Tibs. Sales of Paks and Tibs totaled $100,000 and $300,000, respectively, in the Northern territory during June. Variable expenses are 25% of the selling price for Paks…
Vulcan Company's contribution format income statement for June is as follows: Vulcan Company Income Statement For the Month Ended June 30 Sales Variable expenses Contribution margin Fixed expenses Net operating income $ 750,000 336,000 414,000 378,000 $ 36,000 Management wants to improve profits and gathered the following data: a. The company is divided into two sales territories-Northern and Southern. The Northern territory recorded $300,000 in sales and $156,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern territory. Fixed expenses of $120,000 and $108,000 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 $50,000 and $250,000, respectively, in the Northern territory during June. Variable expenses are 22% of the selling price for Paks…
Vulcan Company's contribution format income statement for June is es follows: Vulcan Company Income Statenent For the Month Ended June 30 Sales Variable expenses Contribution margin Fixed expenses $ 9e0, e00 488, 00e 492, 800 455,000 Net operating income $ 37,000 Management is disoppointed with the company's performance and is wondering what con be done to improve profits. By examining soles and cost records, you have determined the following: 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 $204,000 and $120,000 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 $210,000 and…
Crossfire Company segments its business into two regions—East and West. The company prepared a contribution format segmented income statement as shown below: Total Company East West Sales $ 915,000 $ 610,000 $ 305,000 Variable expenses 732,000 518,500 213,500 Contribution margin 183,000 91,500 91,500 Traceable fixed expenses 111,000 51,000 60,000 Segment margin 72,000 $ 40,500 $ 31,500 Common fixed expenses 60,000 Net operating income $ 12,000 Required: 1. Prepare a new segmented income statement based on the break-even dollar sales that you computed in requirements 2 and 3. What is Crossfire’s net operating income (loss) in your new segmented income statement? 2. Do you think that Crossfire should allocate its common fixed expenses to the East and West regions when computing the break-even points for each region?
Vulcan Company's contribution format income statement for June is as follows: Vulcan Company Income Statement For the Month Ended June 50 Sales Variable expenses Contribution margin Fixed expenses Net operating income $ 750,000 336,000 414,000 378,000 $ 36,000 Management wants to improve profits and gathered the following data: a. The company is divided into two sales territories-Northem and Southern. The Northern territory recorded $300,000 in sales and $156,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern territory. Fixed expenses of $120,000 and $108,000 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 $50,000 and $250,000, respectively, in the Northern territory during June. Variable expenses are 22% of the selling price for Paks…
Vulcan Company’s contribution format income statement for June is as follows: Vulcan Company Income Statement For the Month Ended June 30 Sales $ 900,000 Variable expenses 400,000 Contribution margin 500,000 Fixed expenses 485,000 Net operating income $ 15,000 Management wants to improve profits and gathered the following data: * The company is divided into two sales territories—Northern and Southern. The Northern Territory recorded $400,000 in sales and $160,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern Territory. Fixed expenses of $184,000 and $150,000 are traceable to the Northern and Southern Territories, respectively. The rest of the fixed expenses are common to the two territories.  * The company is the exclusive distributor for two products—Paks and Tibs. Sales of Paks and Tibs totaled $290,000 and $110,000, respectively, in the Northern territory during June. Variable expenses are 29% of the selling price for…
Vulcan Company’s contribution format income statement for June is as follows: Vulcan Company Income Statement For the Month Ended June 30 Sales $ 900,000 Variable expenses 400,000 Contribution margin 500,000 Fixed expenses 450,000 Net operating income $ 50,000 Management wants to improve profits and gathered the following data: The company is divided into two sales territories—Northern and Southern. The Northern Territory recorded $400,000 in sales and $180,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern Territory. Fixed expenses of $200,000 and $115,000 are traceable to the Northern and Southern Territories, respectively. The rest of the fixed expenses are common to the two territories. The company is the exclusive distributor for two products—Paks and Tibs. Sales of Paks and Tibs totaled $170,000 and $230,000, respectively, in the Northern territory during June. Variable expenses are 22% of the selling price for Paks and…
Vulcan Company's contribution format income statement for June is as follows: Vulcan Company Income Statement: For the Month Ended June 30 Sales Variable expenses Contribution margin Fixed expenses Net operating income. $ 900,000 300,000 600,000 495,000 $ 105,000 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: a. The company is divided into two sales territories-Northern and Southern. The Northern Territory recorded $400,000 in sales and $200,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern Territory. Fixed expenses of $156,000 and $145,000 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 $190,000 and…
A corporation has two major business segments--A and B. The following information is given for each division for March. Revenue Variable expenses Traceable fixed expenses Allocated common expenses O $50,000. $60,000. A properly constructed segmented income statement in a contribution format would show that the segment margin of the B business segment is: $106,000. A $690,000 352,000 O $(13,000). 104,000 89,000 B $140,000 34,000 46,000 73,000
Vulcan Company’s contribution format income statement for June is as follows: Vulcan CompanyIncome StatementFor the Month Ended June 30 Sales $ 900,000 Variable expenses 400,000 Contribution margin 500,000 Fixed expenses 475,000 Net operating income $ 25,000 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: The company is divided into two sales territories—Northern and Southern. The Northern Territory recorded $400,000 in sales and $160,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern Territory. Fixed expenses of $176,000 and $140,000 are traceable to the Northern and Southern Territories, respectively. The rest of the fixed expenses are common to the two territories. The company is the exclusive distributor for two products—Paks and Tibs. Sales of Paks and…
Vulcan Company's contribution format income statement for June is as follows: Vulcan Company Income Statement For the Month Ended June 30 Sales Variable expenses Contribution margin Fixed expenses ३900, 000 400,000 500,000 475,000 $ 25,000 Net operating income 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: a. The company is divided into two sales territories-Northern and Southern. The Northern Territory recorded $400,000 in sales and $160,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern Territory. Fixed expenses of $176,000 and $140,000 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 $140,000 and…

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1-a. Prepare contribution format income statements for the total company segmented by sales territories. 1-b. Prepare contribution format income statements for the Northern Territory segmented by product line.