Jackson County Senior Services is a nonprofit organization devoted to providing essential services to seniors who live in their own homes within the Jackson County area. Three services are provided for seniors-home nursing, Meals On Wheels, and housekeeping Data on revenue and expenses for the past year follow: Meals on House Total Home Nursing Wheels Revenues keeping $ 932,800 $ 270,000 $ 406,000 $ 256,000 Variable expenses 476,000 114, eee 206,988 156,000 Contribution margin 456,000 156,000 200,000 Fixed expenses 100,000 Depreciation 69,200 8,200 40,500 Liability insurance 20,500 42,900 20, 200 Progran administrators' salaries 7.500 15,200 115,100 40,100 38,200 36,800 General administrative overhead 186,400 Total fixed expenses 54.000 81,200 51,200 413,600 122,500 167,400 123, 700 Net operating income (loss) $ 42,400 5 33,500 $ 32,600 $(23,700) nces "Allocated on the basis of program revenues The head administrator of Jackson County Senior Services, Judith Miyama, considers last year's net operating income of $42.400 to be unsatisfactory, therefore, she is considering the possibility of discontinuing the housekeeping program The depreciation in housekeeping is for a small van that is used to carry the housekeepers and their equipment from job to Job If the program were discontinued, the van would be donated to a charitable organization None of the general administrative overhead would be avoided if the housekeeping program were dropped, but the liability insurance and the salary of the program administrator would be avoided. Required: 1-a. What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? 1-b Based on the financial advantage (disadvantage) of discontinuing the Housekeeping program calculated in requirement Req 1A should the Housekeeping program be discontinued? 2-a Prepare a properly formatted segmented income statement 2-b. Would a segmented income statement format be more useful to management in assessing the long-run financial viability of the various services? Complete this question by entering your answers in the tabs below. Reg 1A Reg 1B Red 2A Reg 28 What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? Financial (disadvantage) Complete this question by entering your answers in the tabs below. Req 1A Reg 1B Reg 2A Reg 28 Prepare a properly formatted segmented income statement. Total Home Nursing Meals On Wheels House keeping 0 0 0 0 Revenues Variable expenses Contribution margin Traceable fixed expenses Depreciation Liability insurance Program administrators salaries Total traceable fixed expenses Program segment margins General administrative overhead Net operating income (loss) 0 0 0 0 S 0 S is 0 0 0
