215) Azuki Corporation operates in two sales territories, Urban and Rural. Data concerning last
year’s operations appear below:
Urban
Rural
Sales
$
320,000
$
80,000
Variable expenses
208,000
56,000
Contribution margin
112,000
24,000
Traceable fixed expenses
48,000
30,000
Segment margin
$
64,000
$
(6,000
)
Azuki’s common fixed expenses were $25,000 last year.
If Urban sales were 10% higher last year, by approximately how much would Azuki’s net
operating income have increased? (Assume no change in selling prices, unit variable expenses,
or total fixed expenses.)
A) $4,400
B) $6,400
C) $11,200
D) $32,000
216) Azuki Corporation operates in two sales territories, Urban and Rural. Data concerning last
year’s operations appear below:
Urban
Rural
Sales
$
320,000
$
80,000
Variable expenses
208,000
56,000
Contribution margin
112,000
24,000
Traceable fixed expenses
48,000
30,000
Segment margin
$
64,000
$
(6,000
)
Azuki’s common fixed expenses were $25,000 last year.
If operations in the Rural Sales Territory would have been discontinued at the beginning of last
year, how would this have changed the net operating income of Azuki Corporation as a whole?
A) $5,000 increase
B) $6,000 increase
C) $11,000 increase
D) $24,000 decrease
217) Nantor Corporation has two divisions, Southern and Northern. The following information
was taken from last year’s income statement segmented by division:
Southern
Northern
Sales
$
8,000,000
$
5,000,000
$
3,000,000
Contribution margin
$
3,300,000
$
2,100,000
$
1,200,000
Divisional segment margin
$
2,000,000
$
1,400,000
$
600,000
Net operating income last year for Nantor Corporation was $800,000.
In last year’s income statement segmented by division, what were Nantor’s total common fixed
expenses?
A) $1,300,000
B) $1,600,000
C) $1,250,000
D) $1,200,000
218) Nantor Corporation has two divisions, Southern and Northern. The following information
was taken from last year’s income statement segmented by division:
Southern
Northern
Sales
$
8,000,000
$
5,000,000
$
3,000,000
Contribution margin
$
3,300,000
$
2,100,000
$
1,200,000
Divisional segment margin
$
2,000,000
$
1,400,000
$
600,000
Net operating income last year for Nantor Corporation was $800,000.
If the Northern Division’s sales last year were $600,000 higher, how would this have changed
Nantor’s net operating income? (Assume no change in selling prices, variable expenses per unit,
or fixed expenses.)
A) $240,000 increase
B) $60,000 increase
C) $160,000 increase
D) $1,200,000 increase
219) Data for January for Bondi Corporation and its two major business segments, North and
South, appear below:
Sales revenues, North
$
660,000
Variable expenses, North
$
383,000
Traceable fixed expenses, North
$
79,000
Sales revenues, South
$
510,000
Variable expenses, South
$
291,000
Traceable fixed expenses, South
$
66,000
In addition, common fixed expenses totaled $179,000 and were allocated as follows: $93,000 to
the North business segment and $86,000 to the South business segment.
The contribution margin of the South business segment is:
A) $198,000
B) $496,000
C) $219,000
D) $105,000
Sales
$
510,000
Variable expenses
291,000
Contribution margin
$
219,000
220) Data for January for Bondi Corporation and its two major business segments, North and
South, appear below:
Sales revenues, North
$
660,000
Variable expenses, North
$
383,000
Traceable fixed expenses, North
$
79,000
Sales revenues, South
$
510,000
Variable expenses, South
$
291,000
Traceable fixed expenses, South
$
66,000
In addition, common fixed expenses totaled $179,000 and were allocated as follows: $93,000 to
the North business segment and $86,000 to the South business segment.
A properly constructed segmented income statement in a contribution format would show that
the segment margin of the North business segment is:
A) $105,000
B) $383,000
C) $198,000
D) $184,000
Sales
$
660,000
Variable expenses
383,000
Contribution margin
277,000
Traceable fixed expenses
79,000
Segment margin
$
198,000
221) Data for January for Bondi Corporation and its two major business segments, North and
South, appear below:
Sales revenues, North
$
660,000
Variable expenses, North
$
383,000
Traceable fixed expenses, North
$
79,000
Sales revenues, South
$
510,000
Variable expenses, South
$
291,000
Traceable fixed expenses, South
$
66,000
In addition, common fixed expenses totaled $179,000 and were allocated as follows: $93,000 to
the North business segment and $86,000 to the South business segment.
A properly constructed segmented income statement in a contribution format would show that
the net operating income of the company as a whole is:
A) $(7,000)
B) $172,000
C) $351,000
D) $496,000
Sales
$
1,170,000
$
660,000
$
510,000
Variable expenses
383,000
291,000
Contribution margin
277,000
219,000
Traceable fixed expenses
Segment margin
$
198,000
$
153,000
Common fixed expenses
Net operating income
$
222) Tubaugh Corporation has two major business segments—East and West. In December, the
East business segment had sales revenues of $690,000, variable expenses of $352,000, and
traceable fixed expenses of $104,000. During the same month, the West business segment had
sales revenues of $140,000, variable expenses of $56,000, and traceable fixed expenses of
$24,000. The common fixed expenses totaled $162,000 and were allocated as follows: $89,000
to the East business segment and $73,000 to the West business segment.
The contribution margin of the West business segment is:
A) $84,000
B) $234,000
C) $422,000
D) $145,000
223) Tubaugh Corporation has two major business segments—East and West. In December, the
East business segment had sales revenues of $690,000, variable expenses of $352,000, and
traceable fixed expenses of $104,000. During the same month, the West business segment had
sales revenues of $140,000, variable expenses of $56,000, and traceable fixed expenses of
$24,000. The common fixed expenses totaled $162,000 and were allocated as follows: $89,000
to the East business segment and $73,000 to the West business segment.
A properly constructed segmented income statement in a contribution format would show that
the segment margin of the East business segment is:
A) $352,000
B) $145,000
C) $234,000
D) $249,000
224) Tubaugh Corporation has two major business segments—East and West. In December, the
East business segment had sales revenues of $690,000, variable expenses of $352,000, and
traceable fixed expenses of $104,000. During the same month, the West business segment had
sales revenues of $140,000, variable expenses of $56,000, and traceable fixed expenses of
$24,000. The common fixed expenses totaled $162,000 and were allocated as follows: $89,000
to the East business segment and $73,000 to the West business segment.
A properly constructed segmented income statement in a contribution format would show that
the net operating income of the company as a whole is:
A) $294,000
B) $422,000
C) $132,000
D) $(30,000)
225) Ieso Corporation has two stores: J and K. During November, Ieso Corporation reported a
net operating income of $30,000 and sales of $450,000. The contribution margin in Store J was
$100,000, or 40% of sales. The segment margin in Store K was $30,000, or 15% of sales.
Traceable fixed expenses are $60,000 in Store J, and $40,000 in Store K.
Sales in Store J totaled:
A) $400,000
B) $250,000
C) $150,000
D) $100,000
226) Ieso Corporation has two stores: J and K. During November, Ieso Corporation reported a
net operating income of $30,000 and sales of $450,000. The contribution margin in Store J was
$100,000, or 40% of sales. The segment margin in Store K was $30,000, or 15% of sales.
Traceable fixed expenses are $60,000 in Store J, and $40,000 in Store K.
Variable expenses in Store K totaled:
A) $70,000
B) $110,000
C) $200,000
D) $130,000
227) Ieso Corporation has two stores: J and K. During November, Ieso Corporation reported a
net operating income of $30,000 and sales of $450,000. The contribution margin in Store J was
$100,000, or 40% of sales. The segment margin in Store K was $30,000, or 15% of sales.
Traceable fixed expenses are $60,000 in Store J, and $40,000 in Store K.
Ieso Corporation’s total fixed expenses for the year were:
A) $40,000
B) $100,000
C) $140,000
D) $170,000
228) Ferrar Corporation has two major business segments: Consumer and Commercial. Data for
the segments and for the company for March appear below:
Sales revenues, Consumer
$
680,000
Sales revenues, Commercial
$
280,000
Variable expenses, Consumer
$
394,000
Variable expenses, Commercial
$
143,000
Traceable fixed expenses, Consumer
$
102,000
Traceable fixed expenses, Commercial
$
45,000
In addition, common fixed expenses totaled $210,000 and were allocated as follows: $122,000 to
the Consumer business segment and $88,000 to the Commercial business segment.
The contribution margin of the Commercial business segment is:
A) $137,000
B) $184,000
C) $62,000
D) $423,000
Sales
$
Variable expenses
Contribution margin
$
229) Ferrar Corporation has two major business segments: Consumer and Commercial. Data for
the segments and for the company for March appear below:
Sales revenues, Consumer
$
680,000
Sales revenues, Commercial
$
280,000
Variable expenses, Consumer
$
394,000
Variable expenses, Commercial
$
143,000
Traceable fixed expenses, Consumer
$
102,000
Traceable fixed expenses, Commercial
$
45,000
In addition, common fixed expenses totaled $210,000 and were allocated as follows: $122,000 to
the Consumer business segment and $88,000 to the Commercial business segment.
A properly constructed segmented income statement in a contribution format would show that
the segment margin of the Consumer business segment is:
A) $164,000
B) $62,000
C) $394,000
D) $184,000
Sales
$
680,000
Variable expenses
384,000
Contribution margin
286,000
Traceable fixed expenses
102,000
Segment margin
$
184,000
230) Ferrar Corporation has two major business segments: Consumer and Commercial. Data for
the segments and for the company for March appear below:
Sales revenues, Consumer
$
680,000
Sales revenues, Commercial
$
280,000
Variable expenses, Consumer
$
394,000
Variable expenses, Commercial
$
143,000
Traceable fixed expenses, Consumer
$
102,000
Traceable fixed expenses, Commercial
$
45,000
In addition, common fixed expenses totaled $210,000 and were allocated as follows: $122,000 to
the Consumer business segment and $88,000 to the Commercial business segment.
A properly constructed segmented income statement in a contribution format would show that
the net operating income of the company as a whole is:
A) $66,000
B) $(144,000)
C) $423,000
D) $276,000
Sales
$
$
680,000
$
280,000
Variable expenses
394,000
143,000
Contribution margin
286,000
137,000
Traceable fixed expenses
102,000
Segment margin
$
184,000
$
Common fixed expenses
Net operating income
$
231) Bertie Corporation has two divisions: Retail Division and Wholesale Division. The
following data are for the most recent operating period:
Total
Company
Retail Division
Wholesale
Division
Sales
$
680,000
$
375,000
$
233,000
Variable expenses
$
185,530
$
90,000
$
95,530
Traceable fixed expenses
$
303,000
$
217,000
$
86,000
The common fixed expenses of the company are $103,360.
The Retail Division’s break-even sales is closest to:
A) $369,408
B) $421,526
C) $584,815
D) $285,526