Exotic Sporting Goods is a retailer of sporting equipment. Last year, Exotic Sporting Goods' sales revenues totalled $6,500,000. Total expenses were $2,200,000. Of this amount, approximately $1,325,000 were variable, while the remainder were fixed. Since Exotic Sporting Goods offers thousands of different products, its managers prefer to calculate the break-even point in terms of sales dollars rather than units.

Assume that Exotic Sporting Goods gathers information on the sales of its products based on two departments: Winter Sports and Summer Sports. Winter Sports revenues are $4,500,000 of the total $6,500,000 and the department has an average contribution margin of 75%, while Summer Sports brings in the remaining revenues and has a contribution margin of 90%. Of the fixed costs, $270,000 can be directly traced to Winter Sports and $530,000 can be traced to Summer Sports. Prepare a segmented contribution margin income statement for Exotic Sporting Goods.

Prepare a segmented contribution margin income statement for Exotic Sporting Goods.

Exotic Sporting Goods
Segmented Contribution Margin Income Statement
For the Year Ended December 31
	Winter	Summer
	Sports	Sports	Total
Revenues
Variable expenses
Contribution margin
Traceable fixed expenses
Segment margin
Common costs
Net income