Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Companhia Bradesco, S.A, of Brazil, an industrial supply store chain, has two divisions. The company's contribution format income statement segmented by divisions for last year

image text in transcribed
image text in transcribed
image text in transcribed
Companhia Bradesco, S.A, of Brazil, an industrial supply store chain, has two divisions. The company's contribution format income statement segmented by divisions for last year is given below (the currency in Brazil is the real, denoted here by R) Division Total Company Plastics 1,778,900 1,040,520 233,700119,000 Glass R3,498,300 R2,001,000 R1,497,300 Sales Variable expenses Contribution margin Traceable fixed expenses 960,480 758,920 738,380 1,719,400 616.400304,000 312.400 209,000 502.820 R408.520R94.300 Advertising 114,700 216,980 Depreciation 425,980 Administration Total Division segment margin Common foxed expenses Net operating income 1,276,080632,000 644,080 381,000 Top management doesn't understand why the Glass Division has such a low segment margin when its sales are only 25 less than sales in the Plastics Division. Accordingly, management has directed that the Glass Division be further segmented into product lines The followving information is available on the product lines in the Glass Division: Glass Division Product Lines Specialty Flat Glass Auto Glass Glass R496,000701,300 Sales 300,000 Traceable fxed expenses Advertising Depreciation Administration R79,900 R112,200 R120,300 R25,000R56,300 R33,400 R30,400R35,300 R41,800 Variable expenses as a percentage of sales 65% 40% 52% Analysis shows that R109,480 of the Glass Division's administration expenses are common to the product lines

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Modern Auditing

Authors: Graham Cosserat

2nd Edition

0470863226, 978-0470863220

More Books

Students also viewed these Accounting questions