Question
Blossom Corporation provided the following segment margin income statement for two of its divisions: East and West. East West Total Revenue $ 575,000 $ 567,000
Blossom Corporation provided the following segment margin income statement for two of its divisions: East and West.
East | West | Total | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Revenue | $ | 575,000 | $ | 567,000 | $ | 1,142,000 | |||||
Variable expenses | |||||||||||
Product | 393,000 | 283,000 | 676,000 | ||||||||
Selling and administrative | 103,000 | 111,000 | 214,000 | ||||||||
Contribution margin | 79,000 | 173,000 | 252,000 | ||||||||
Less traceable fixed costs | 43,000 | 63,000 | 106,000 | ||||||||
Segment margin | $ | 36,000 | $ | 110,000 | 146,000 | ||||||
Common fixed costs | 176,000 | ||||||||||
Net operating income | $ | (30,000 | ) |
Blossom actual weighted-average cost of capital is 10% and its tax rate is 30%. The East division balance sheet showed $323,000 of assets ($81,000 current and $242,000 long-term) and $343,000 of liabilities ($142,000 current and $201,000 long-term). The West division reported $383,000 of assets ($101,000 current and $282,000 long-term) and $283,000 of liabilities ($83,000 current and $200,000 long-term).
Calculate the economic value added for each division.
East | West | ||
---|---|---|---|
Economic value added | $enter economic value added in dollars for east | $enter economic value added in dollars for west |
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