Crossfire Company segments its business into two regionsEast and West. The company prepared a contribution format segmented income statement as shown below:

	Total Company			East			West
Sales	$	930,000		$	620,000		$	310,000
Variable expenses		744,000			514,600			229,400
Contribution margin		186,000			105,400			80,600
Traceable fixed expenses		116,000			51,000			65,000
Segment margin		70,000		$	54,400		$	15,600
Common fixed expenses		62,000
Net operating income	$	8,000

Required:

1. Compute the companywide break-even point in dollar sales.

2. Compute the break-even point in dollar sales for the East region.

3. Compute the break-even point in dollar sales for the West region.

4. Prepare a new segmented income statement based on the break-even dollar sales that you computed in requirements 2 and 3. What is Crossfires net operating income (loss) in your new segmented income statement?

5. Do you think that Crossfire should allocate its common fixed expenses to the East and West regions when computing the break-even points for each region?