18(a)

Preparation of responsibility income statements

Hal-Marts' Inc. has two sales departments: equipment and clothing. During February, these two departments reported the following operating results:

	Equipment	Clothing
Sales	$490,000	$250,000
Contribution margin	35%	50%
Traceable fixed costs	$29,200	$26,800

In addition, fixed costs common to both departments amounted to $54,400.

Complete the following responsibility income statement for Hal-Marts, Inc. Follow the contribution margin approach, and show percentages as well as dollar amounts. Conclude your income statement with the company's income from operations. (Round your percentage computations to nearest whole percent)

HAL-MARTS, INC

Income Statement by Product Lines

For the Month Ended February 28, 20__

	Hal-Mart, Inc.		Segments
			Equipment		Clothing
	Dollars	%	Dollars	%	Dollars	%
Sales			$490,000		$250,000
Contribution margin
Responsibility margin

18(b)

Aron Company makes computer screens, Model 1 and Model 2. Aron anticipates selling the screens as follows:

	Unit of	Units of
	Model 1	Model 2
Quarter ending 3/31	5,000	6,000
Quarter ending 6/30	4,500	5,500
Quarter ending 9/30	5,500	6,500
Quarter ending 12/31	6,000	7,000

The inventory on 1/1/18 is 2500 units of Model 1 and 3000 units of Model 2. Aron wants to have on hand 45% of the anticipated sales of the following month for each model. Prepare a production budget for the first 3 quarters of 2018 for both models.