5 Exercise 6-11 Segmented Income Statement (L06-4) 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 20 Sales Variable expenses Contribution margin Pred expenses Met operating incontest - 1 1.622,ese 785,34 115.660 1.687, $91,340) 10 10 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 Division East Central West Sales 1462. 5670,000 5550,000 Variable expenses as percentage of sales Trace to expenses 5230 491 3255,000 $334,000 5207.be 10 Required: 1. Prepare a contribution format income statement segmented by divisions 2-4 The Marketing Department has proposed increasing the West Division's monthly advertising by $23.000 based on the belief that it would increase that division's sales by Assuming these estimates are accurate, how much would the company's net operating income increase decrease the proposal is implemented? 2. Would you recommend the increased advertising? Complete this question by entering your answers in the tabs below. Ree ZA Red 25 Prepare contribution format income statement segmented by divisions. Total Company East Division Central West o 0 O $ 0 $ OS 9 0 Res 2A > 5 Exercise 6-11 Segmented Income Statement [L06-4) Wingate Company, wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales are expenses Contribution margin e expenses operating income less $ 1,622.000 785,340 915,660 1,607,00 $ (91,3481 po 10 l han 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: Division Central 1670,000 341 5334,000 East 5402,000 528 1255,000 Variable expenses percentage of sales Traceable fixed expenses $550,00 494 $20 Required: t. Prepare a contribution format income statement segmented by divisions 2 The Marketing Department has proposed increasing the West Division's monthly advertising by $23,000 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 the proposal is implemented? 2-6. Would you recommend the increased advertising Complete the question by entering your answers in the tabs below. Reg 1 Reg 2A Reg 20 The Martin Department has proposed increasing the West Division's monthly advertising by $23,000 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 perting income increase (decrease of the proposal is implemented? (Do not round Intermediate calculations.)
