3900 200 190 80 4001 700 600 300 3009 60150 4950| 2500 2450| 8001 450| 120. 9,040 S T05 5 9450 6255 1350 65 4960 Sales commissions Other 17.345 5.650 2,655 S 31,895 14,550 Total variable expenses 1.350 Segment contribution margin Fioxed expenses controllable by segment manager OS 550S 2905260 70OS 500S 140 75 1600 145 5001 200 770 01-4500| 3200| 60 6001 2000 355 2005535 0 O 3102100020206 545 s margin controlablo by segment manager5 1320 8140 5275 1100 240) 415 Computing and billing Warehouse Insurance Total 1,985 1,310 250 S 185 980 Profit margin controlable by segment manager S 13,720 S 8,140 Fixed expenses, traceable to segment, but controllable by others 5.275 1,100 70 260 305170 1354 3 60 690 Property taxes 160130 30 3 Supervisory salaries 400 15 1,225 1570 ,275 325 S 230 720 12.495 |s 6.570 4,000 IS 775 S (470) |s 3.695 (20 Profit margin traceable to segment 160,000 Common fixed expenses s (147,505) 3,050,000 5(3,197,505) Income before taxes Income tax expense Net income Buckeye Department Stores, Inc. operates a chain of department stores in Ohio. The company's organization chart appears below Operating data for 20x1 follow 25 Buckeye Department Stores Cleveland Division Columbus Division Individual Stores Downtown Store Store Store BUCKEYE DEPARTMENT STORES, INC Operating Data for 20x1 (in thousands) Columbus Division Scioto Cleveland Division (total Olentangy Store or all stores) s 24,000 Sales revenue Variable expenses Cost of merchandise sold $ 7,089 $ 2,680$14,800 2,200 310 12.000 8,800 5,000 400 80 Sales comissions utilities 1se 120 Other Fixed expenses Depreciation-buildings Depreciation-furnishings Computing and billing 470 120 290 140 160 6e Insurance 1170 930 210 Property taxes Superyisory salaries Security 160 130 The following fixed expenses are controllable at the divisional level: depreciation-furnishings, computing and billing, warehouse insurance, and security. In addition to these expenses, each division annually Incurs $50,000 of computing costs, which are not allocated to individual stores The following fixed expenses are controilable only at the company level: depreciation-building, property taxes, and supervisory salaries. In addition to these expenses, each division incurs costs for supervisory salaries of $150,000, which are not allocated to individual stores. Buckeye Department Stores incurs common fixed expenses of $160,000, which are not allocated to the two divisions. Income-tax expense for 20x1 is $3.050,000 Required: 1. Prepare a segmented income statement for Buckeye Department Stores, Inc 2 How would the segmented income statement help the president of Buckeye Department Stores manage the company
