Question
Hepras, Inc., has two product lines: routers and ethernet switches. During the current month, the two product lines reported the following results. Routers Switches Sales
Hepras, Inc., has two product lines: routers and ethernet switches. During the current month, the two product lines reported the following results.
| Routers | Switches | ||||||
| Sales | $ | 670,000 | $ | 710,000 | |||
| Variable costs (as a percentage of sales) | 40 | % | 45 | % | |||
| Traceable fixed costs | $ | 250,000 | $ | 125,000 | |||
In addition, fixed costs common to both product lines amounted to $214,000.
Prepare an income statement showing percentages as well as dollar amounts. Conclude your statement with income from operations for the business and with the responsibility margin for each product line. (Round percentage answers to 2 decimal place. i.e. 0.1234 should be considered as 12.34%.)
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Financial and Managerial Accounting the basis for business decisions
Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello
17th edition
007802577X, 978-0078025778
