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3 Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format
3 Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement 10 points Sales Variable expenses Contribution margin Fixed expenses Net operating income (loss) $1,616,000 601,140 1,014,860 1,116,000 s (101,140) eBook In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following information: Hint Division Central $446,000 $640,000 $530,000 East West Print Sales Variable expenses as a percentage of sales Traceable fixed expenses 26% $329,000 $193,000 19.45% Required 1. Prepare a contribution format income statement segmented by divisions 2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $21,000 based on the belief that it would increase that division's sales by 13%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease) if the proposal is implemented? 2-b. Would you recommend the increased advertising? Complete this question by entering your answers in the tabs below. Req 2A Req 2B Req 1 Prepare a contribution format income statement segmented by divisions. Division Total Company East Central West Req 1 Req 2A> Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 2B The Marketing Department has proposed increasing the West Division's monthly advertising by $21,000 based on the belief that it would increase that division's sales by 13%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease) if the proposal is implemented? (Do not round intermediate calculations.) Net operating income will by Req 1 Req 2B > Complete this question by entering your answers in the tabs below Req 1 Would you recommend the increased advertising? OYes Req 2A Req 2B Req 2A Req 2B
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