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:

Required:

1. Prepare a segmented performance report; use Exhibit 12?3 as your guide.

2. Compute the contribution margin percentage (contribution margin divided by sales) and segment margin percentage. On the basis of the dollar amounts and percentages, how would you assess the performance of the three segments (i.e., the three product lines)?

3. Allocate the common fixed expenses equally to the three segments and prepare a performance report similar to the one in Exhibit 12?3. As a manager overseeing all three segments, how would you react to the report?

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High-End Speakers Personal Handheld Total Computers Devices 340,000 550,000 Sales (in units) 440,000 Price (per unit) $1,500 $1,250 $375 Variable costs per unit: Direct materials 426 384 40 120 Direct labour 210 48 80 Overhead 110 37 Shipping 30 30 4 Sales commissions 20 20 2 Direct fixed costs: Salaries $61,560,000 70,250,000 40,330,000 Utilities 41,250,000 55,005,000 12,500,600 Depreciation 59,000,250 112,600,000 30,250,000 Common fixed costs: Corporate salaries $33,460,000 Building depreciation 27,900,800 Legal & accounting 41,380,640 Other 11,340,760