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Exercise 15-18 (Algo) Segmented income statement LO 15-8 Vogel Company produces three models of heating and air conditioning thermostat components. The following table summarizes data
Exercise 15-18 (Algo) Segmented income statement LO 15-8 Vogel Company produces three models of heating and air conditioning thermostat components. The following table summarizes data about each model: Selling price per unit Contribution margin per unit Units sold per month Total contribution margin: Direct fixed expenses Segment margin Allocated company fixed expenses Operating income (loss)) Required: 1 BV19 $ 16 HV41 MV12 $ 20 $ 10 4 6 8,750 3,750 $ 22,500 14,300 $ 35,000 19,000 $16,000 7,800 $ 8,200 5,200 $ 8,200 $ 3,000 12,500 $ 12,500 8,600 $ 3,900 13,000 $ (9,100) a. On what basis does the $26,000 of company fixed expenses appear to be allocated? b. Calculate the effect on total company net income if the MV12 model were discontinued. c. Calculate the contribution margin ratio for each model. d. If an advertising campaign focusing on a single model were to result in an increase of 5,000 units in the quantity of units sold, which model should be advertised? e. If an advertising campaign focusing on a single model were to result in an increase pf $31,000 in revenues, which model should be advertised? Complete this question by entering your answers in the tabs below Req A Req B Req C Req D and E On what basis does the $26,000 of company fixed expenses appear to be allocated? On what basis does the $17,000 of company fixed expenses appear to be allocated? Complete this question by entering your answers in the tabs below Req A Req B Req C Req D and E Calculate the effect on total company net income if the MV12 model were discontinued. The net income would < Req A Req C > Complete this question by entering your answers in the tabs below Req A Req B Req C Req D and E Calculate the contribution margin ratio for each model. Note: Enter your percentage answers as a whole number. Contribution margin ratio BV19 HV41 MV12 < Req B Req D and E > Complete this question by entering your answers in the tabs below Req A Req B Req C Req D and E d. If an advertising campaign focusing on a single model were to result in an increase of 5,000 units in the quantity of units sold, which model should be advertised? e. If an advertising campaign focusing on a single model were to result in an increase of $31,000 in revenues, which model should be advertised? Show less A d. e
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