9.5 Questions

1) To calculate the contribution by segment, take contribution controllable by segment managers minus ________.

A) unallocated costs

B) variable operating expenses

C) fixed costs controllable by others

D) fixed costs controllable by segment managers

2) To calculate income before taxes for a segmented company as a whole, take contribution by segments and subtract ________.

A) allocated costs

B) unallocated costs

C) costs controllable by segment managers

D) costs controllable by third parties

3) Which is NOT a fixed cost controllable by a segment manager?

A) salespersons' salaries for segment

B) advertising costs in local paper to promote segment

C) training costs for new employees at segment

D) segment manager's salary

4) When preparing segmented income statements, fixed costs controllable by others, and not the segment manager, include ________.

A) depreciation on building used by a segment

B) local advertising costs for a segment

C) local promotion costs for a segment

D) salary of supervisor of sales staff for a segment

5) Segment contribution margin less ________ describes the segment contribution that is controllable by segment managers.

A) fixed costs controllable by segment managers

B) fixed costs not controlled by segment managers

C) unallocated costs

D) uncontrollable costs

6) The following information pertains to the Lower Division of Peapod Company:

Net Sales$25,000

Variable Costs:

Cost of merchandise sold7,200

Operating expenses2,700

Fixed costs:

Controllable by segment manager2,400

Controllable by others1,000

Unallocated costs600

The contribution controllable by a segment manager is ________.

A) $7,100

B) $7,700

C) $11,100

D) $12,700

7) The following information pertains to the Upper Division of Yoko Company:

Net Sales$21,000

Variable Costs:

Cost of merchandise sold7,200

Operating expenses2,700

Fixed costs:

Controllable by segment manager2,400

Controllable by others1,000

Unallocated costs7,600

The contribution by segment is ________.

A) $7,100

B) $7,700

C) $8,700

D) $11,100

8) The following information pertains to the Southern Division of Peapod Company:

Net Sales$5,250

Variable Costs:

Cost of merchandise sold1,200

Operating expenses450

Fixed costs:

Controllable by segment manager600

Controllable by others1,250

Unallocated costs1,150

The contribution controllable by a segment manager is ________.

A) $2,350

B) $2,500

C) $3,000

D) $3,350

9) The following information pertains to the Southern Division of Bama Company:

Net Sales$5,000

Variable Costs:

Cost of merchandise sold1,200

Operating expenses450

Fixed costs:

Controllable by segment manager600

Controllable by others250

Unallocated costs750

The contribution by segment is ________.

A) $2,350

B) $2,500

C) $2,750

D) $3,350

10) The following information is available for Discounted Supplies Inc. and its two divisions, Durable Goods and Nondurable Goods.

WholeDurableNondurable

CompanyGoodsGoods

Net sales$100,000$60,000$40,000

Fixed costs controllable by

Division Manager16,50012,5004,000

Fixed costs not controlled by

Division Manager8,0005,0003,000

Variable costs:

Cost of merchandise sold24,50017,5007,000

Operating expenses16,40010,0006,400

Unallocated costs1,000

What is the contribution controllable by the manager of the Durable Goods Division?

A) $20,000

B) $32,500

C) $35,000

D) $42,500