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Jackson County Senior Services is a nonprofit organization devoted to providing essential services to seniors who live in their own homes within the Jackson County area. Three services are provided for seniorshome nursing, Meals On Wheels, and housekeeping. Data on revenue and expenses for the past year follow: Meals On Housee Total Home Nursing Wheels keeping Revenues $ 922,666 $ 262,666 $ 469,666 $ 251,666 Variable expenses 483,666 116,666 268,666 159,666 Contribution margin 439,666 146,666 261,666 92,666 Fixed expenses: Depreciation 69,866 8,166 46,966 26,866 Liability insurance 43,666 26,166 7,266 15,766 Program administrator'sJ salaries 115,666 41,666 38,766 35,966 General administrative overhead* 184,466 52,466 81,866 56,266 Total 'Fixed expenses 412,866 121,666 168,666 122,666 Net operating income (loss) $ 26, 266 $ 24,466 $ 32,466 $ (36, 666) \"Allocated on the basis of program revenues. The head administrator of Jackson County Senior Services, Judith Miyama, considers last year's net operating income of $26,200 to be unsatisfactory; therefore, she is considering the possibility of discontinuing the housekeeping program. The depreciation in housekeeping is for a small van that is used to carry the housekeepers and their equipment from job to job. If the program were discontinued, the van would be donated to a charitable organization. None of the general administrative overhead would be avoided if the housekeeping program were dropped, but the liability insurance and the salary of the program administrator would be avoided. Required: 1-a. What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? 1-b. Based on the financial advantage (disadvantage) of discontinuing the Housekeeping program calculated in requirement Reg 1A. should the Housekeeping program be discontinued? 2a. Prepare a properly formatted segmented income statement. 2b. Would a segmented income statement format be more useful to management in assessing the long-run financial viability of the various services? Complete this question by entering your answers in the tabs below. Reg 1A Reg 16 Reg ZA Reg 26 What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? :2 Req 1A Req 1B Req 2A Req 2B Based on the financial advantage (disadvantage) of discontinuing the Housekeeping program calculated in requirement Req 1A, should the Housekeeping program be discontinued? OYes ONOReq 1A Req 1B Req 2A Req 2B Prepare a properly formatted segmented income statement. Total Home Nursing Meals On Wheels House-keeping Revenues Variable expenses Contribution margin Traceable fixed expenses: Depreciation Liability insurance Program administrators' salaries Total traceable fixed expenses Program segment margins General administrative overhead Net operating income (loss)Req 1A Req 1B Req 2A Req 2B Would a segmented income statement format be more useful to management in assessing the long-run financial viability of the various services? OYes ONOSuperior Markets, Incorporated, operates three stores in a large metropolitan area. A segmented absorption costing income statement for the company for the last quarter is given below: Superior Markets, Incorporated Income Statement For the Quarter Ended September 30 Total North Store South Store East Store Sales $ 3, 720,000 $ 892,800 $ 1, 488, 090 $ 1, 339, 200 Cost of goods sold 2, 054,928 499,968 818, 400 736, 560 Gross margin 1, 665, 072 392, 832 669, 600 602, 640 Selling and administrative expenses : Selling expenses 1, 013, 080 286,936 390, 600 335, 544 Administrative expenses 474,920 131, 440 187 , 116 156, 364 Total expenses 1, 488, 090 418, 376 577, 716 491, 908 Net operating income (loss) $ 177, 072 $ (25, 544) $ 91, 884 $ 110, 732 The North Store has consistently shown losses over the past two years. For this reason, management is giving consideration to closing the store. The company has asked you to make a recommendation as to whether the store should be closed or kept open. The following additional information is available for your use: a. The breakdown of the selling and administrative expenses that are shown above is as follows: Total North Store South Store East Store Selling expenses: Sales salaries $ 296, 360 $ 86, 800 $ 110, 360 $ 99, 206 Direct advertising 231, 880 63, 240 89, 280 79, 360 General advertising* 55, 806 13, 392 22, 320 20, 088 Store rent 372, 006 105, 400 148, 800 117, 800 Depreciation of store fixtures 19, 840 5,704 7, 440 6, 696 Delivery salaries 26, 040 8, 680 8, 680 8, 680 Depreciation of delivery equipment 11, 16 3,720 3,720 3,720 Total selling expenses $ 1, 013, 080 $ 286,936 $ 390, 600 $ 335, 544 *Allocated on the basis of sales dollars. Total North Store South Store East Store Administrative expenses: Store managers' salaries $ 86, 800 $ 26,040 $ 37, 200 $ 23,560 General office salaries* 62, 000 14, 880 24, 800 22, 320 Insurance on fixtures and inventory 31, 000 9,306 11, 160 10,540 Utilities 131, 440 38, 440 49, 600 43,400 Employment taxes 70, 680 20, 460 27, 156 23, 064 General office-other* 93, 000 22, 320 37, 200 33 , 480 Total administrative expenses $ 474, 920 $ 131, 440 $ 187, 116 $ 156, 364 *Allocated on the basis of sales dollars. b. The lease on the building housing the North Store can be broken with no penalty. c. The fixtures being used in the North Store would be transferred to the other two stores if the North Store were closed. d. The general manager of the North Store would be retained and transferred to another position in the company if the North Store were closed. She would be filling a position that would otherwise be filled by hiring a new employee at a salary of $13,640 per quarter. The general manager of the North Store would continue to earn her normal salary of $14,880 per quarter. All other managers and employees in the North store would be discharged. e. The company has one delivery crew that serves all three stores. One delivery person could be discharged if the North Store were closed. This person's salary is $4,960 per quarter. The delivery equipment would be distributed to the other stores. The equipment does not wear out through use, but does eventually become obsolete. f. The company pays employment taxes equal to 15% of their employees' salaries. g. One-third of the insurance in the North Store is on the store's fixtures. h. The "General office salaries" and "General office-other" relate to the overall management of Superior Markets, Incorporated. If the North Store were closed, one person in the general office could be discharged because of the decrease in overall workload. This person's compensation is $7,440 per quarter. Required: 1. How much employee salaries will the company avoid if it closes the North Store? 2. How much employment taxes will the company avoid if it closes the North Store? 3. What is the financial advantage (disadvantage) of closing the North Store? 4. Assuming that the North Store's floor space can't be subleased, would you recommend closing the North Store? 5. Assume that the North Store's floor space can't be subleased. However, let's introduce three more assumptions. First, assume that if the North Store were closed, one-fourth of its sales would transfer to the East Store, due to strong customer loyalty to Superior Markets. Second, assume that the East Store has enough capacity to handle the increased sales that would arise from closing the North Store. Third, assume that the increased sales in the East Store would yield the same gross margin as a percentage of sales as present sales in the East store. Given these new assumptions, what is the financial advantage (disadvantage) of closing the North Store? Complete this question by entering your answers in the tabs below.Required 1 Required 2 Required 3 Required 4 Required 5 How much employee salaries will the company avoid if it closes the North Store? Required 1 Required 2 Required 3 Required 4 Required 5 How much employment taxes will the company avoid if it closes the North Store? Required 1 Required 2 Required 3 Required 4 Required 5 What is the financial advantage (disadvantage) of closing the North Store? (Enter any "disadvantages" as a negative value.) Required 1 Required 2 Required 3 Required 4 Required 5 Assuming that the North Store's floor space can't be subleased, would you recommend closing the North Store? The North Store should be closed. The North Store should not be closed.Required 1 Required 2 Required 3 Required 4 Required 5 Assume that the North Store's oor space can't be subleased. However, let's introduce three more assumptions. First, assume that if the North Store were closed, onefourth of its sales would transfer to the East Store, due to strong customer loyalty to Superior Markets. Second, assume that the East Store has enough capacity to handle the increased sales that would arise from closing the North Store. Third, assume that the increased sales in the East Store would yield the same gross margin as a percentage of sales as present sales in the East store. Given these new assumptions, what is the financial advantage (disadvantage) of closing the North Store? (Enter any "disadvantages\" as a negative value.) Show less; Financial advantage (disadvantage) :I ComeClean Corporation produces a variety of cleaning compounds and solutions for both industrial and household use. While most of its products are processed independently, a few are related, such as the company's Grit 337 and its Sparkle silver polish. Grit 337 is a coarse cleaning powder with many industrial uses. It costs $1.60 a pound to make, and it has a selling price of $4.20 a pound. A small portion of the annual production of Grit 337 is retained in the factory for further processing. It is combined with several other ingredients to form a paste that is marketed as Sparkle silver polish. The silver polish sells for $4.00 perjar. This further processing requires onefourth pound of Grit 337 periar of silver polish. The additional direct variable costs involved in the processing of a jar of silver polish are: Other ingredients $ 0.68 Direct labor 1.32 Total direct cost $ 1.92 Overhead costs associated with processing the silver polish are: Variable manufacturing overhead cost 25% of direct labor cost Fixed manufacturing overhead cost (per month) Production supervisor $ 3,200 Depreciation of mixing equipment $ 1J560 The production supervisor has no duties other than to oversee production of the silver polish. The mixing equipment is special purpose equipment acquired specifically to produce the silver polish. It can produce up to 13,000jars of polish per month. lts resale value is negligible and it does not wear out through use. Advertising costs for the silver polish total $1,800 per month. Variable selling costs associated with the silver polish are 5% of sales. Due to a recent decline in the demand for silver polish, the company is wondering whether its continued production is advisable. The sales manager feels that it would be more profitable to sell all of the Grit 337 as a cleaning powder. Required: 1. How much incremental revenue does the company earn perjar of polish by further processing Grit 337 rather than selling it as a cleaning powder? {Round your answer to 2 decimal places.) 2. How much incremental contribution margin does the company earn perjar of polish by further processing Grit 337 rather than selling it as a cleaning powder? (Round your intermediate calculations and final answer to 2 decimal places.) 3. How many jars of silver polish must be sold each month to exactly offset the avoidable fixed costs incurred to produce and sell the polish? (Round your intermediate calculations to 2 decimal places.) 4. If the company sells 7,000jars of polish, what is the financial advantage (disadvantage) of choosing to further process Grit 337 rather than selling it as a cleaning powder? (Enter any "disadvantages" as a negative value. Round your intermediate calculations to 2 decimal places.) 5. If the company sells 10,900 jars of polish, what is the financial advantage (disadvantage) of choosing to further process Grit 337 rather than selling is as a cleaning powder? {Enter any "disadvantages" as a negative value. Round your intermediate calculations to 2 decimal places.) 1. Incremental revenue perjar 2. Incremental contribution margin perjar 3. Number ofjars that must be sold per month 4. Financial advantage (disadvantage) 5. Financial advantage (disadvantage) \"In my opinion, we ought to stop making our own drums and accept that outside supplier's offer," said Wim Niewindt, managing director of Antilles Refining, N.V., of Aruba. \"At a price of $20 per drum, we would be paying $4.45 less than it costs us to manufacture the drums in our own plant. Since we use 65,000 drums a year, that would be an annual cost savings of $289,250.\" Antilles Refining's current cost to manufacture one drum is given below (based on 65,000 drums per year): Direct materials $ 18.95 Direct labor 7.66 Variable overhead 1.66 Fixed overhead ($2.56 general company overheadJ $1.69 depreciation, and $9.89 supervision) 4.99 Total cost per drum $ 24.45 A decision about whether to make or buy the drums is especially important at this time because the equipment being used to make the drums is completely worn out and must be replaced. The choices facing the company are: Alternative 1: Rent new equipment and continue to make the drums. The equipment would be rented for $156,000 per year. Alternative 2: Purchase the drums from an outside supplier at $20 per drum. The new equipment would be more efficient than the equipment that Antilles Refining has been using and, according to the manufacturer. would reduce direct labor and variable overhead costs by 25%. The old equipment has no resale value. Supervision cost {$52,000 per year) and direct materials cost per drum would not be affected by the new equipment. The new equipments capacity would be 100,000 drums per year. The company's total general company overhead would be unaffected by this decision. Required: 1. Assuming that 65,000 drums are needed each year, what is the financial advantage {disadvantage} of buying the drums from an outside supplier? 2. Assuming that 80,000 drums are needed each year, what is the financial advantage (disadvantage) of buying the drums from an outside supplier? 3. Assuming that 100,000 drums are needed each year. what is the financial advantage {disadvantage} of buying the drums from an outside supplier? For all requirements, enter an "disadvanta es" a5 a ne ative value. DO not round intermediate calculations. DO not leave an cells blank.) 1. 55000 drums 2. 80000 drums 3. 100:000 drums