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Exercise 6-10 Companywide and Segment Break-Even Analysis (L06-5) Crossfire Company segments its business into two regions-East and West. The company prepared a contribution format segmented
Exercise 6-10 Companywide and Segment Break-Even Analysis (L06-5) Crossfire Company segments its business into two regions-East and West. The company prepared a contribution format segmented Income statement as shown below: Total Company $ 960,000 $ 640,000 West $ 320,000 230,400 Sales Variable expenses Contribution margin Teaceable fixed expenses Segment margin Cowon fixed expenses Met operating income 50.000 40,000 63.000 26.600 $ $ 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 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? Complete this question by entering your answers in the tabs below. Req 1 to 3 Req Regs 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 (loss) in your new segmented income statement? Total Company East West C Reg 1 to 3 Reg 5 >
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