Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Crosstre company segments its business into two regions-East and west. ine company preparea a contribution format segmentea income statement as shown below: Sales Variable expenses
Crosstre company segments its business into two regions-East and west. ine company preparea a contribution format segmentea income statement as shown below: Sales Variable expenses Contribution margin Traceable fixed expenses Segment margin Common fixed expenses Net operating income Total Company $ 910,000 637,000 273,000 133,000 140,000 56,000 $ 84,000 East $ 650,000 468,000 182,000 70,000 $ 112,000 West $ 260,000 169,000 91,000 63,000 $ 28,000 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. Use the same format as shown above. What is Crossfire's net operating income (oss) 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? Complete this question by entering your answers in the tabs below. Req 1 to 3 Req 4 Reg 5 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. (Round intermediate calculations to 2 decimal places) Show less Break-Even point Dollar sales for the whole company Dollar sales for the East region Dollar sales for the West region
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started