Question
Fog City Retail operates a retail store in Phoenix, Las Vegas, and Portland. The following information relates to the Phoenix facility: The store sold 65,000
Fog City Retail operates a retail store in Phoenix, Las Vegas, and Portland. The following information relates to the Phoenix facility: The store sold 65,000 units at $18.00 each, after having purchased the units from various suppliers for $12.50. Phoenix salespeople are paid a 5% commission based on gross sales dollars. Phoenix's sales manager oversees the placement of local advertising contracts, which totaled $54,000 for the year. Local property taxes amounted to $14,500. The sales manager's $65,000 salary is set by Phoenix's store manager. In contrast, the store manager's $134,000 salary is determined by Fog City's vice president. Phoenix incurred $6,800 of other noncontrollable costs along with $10,000 of income tax expense. Nontraceable (common) corporate overhead totaled $68,000. Fog City's corporate headquarters is located in Portland, and the company uses responsibility accounting to evaluate performance. Required: Prepare a segmented income statement for the Phoenix store, being sure to disclose the segment contribution margin, the segment profit margin, and net income.
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