Lauderdale Corporation is organized in three geographical divisions $($regions$)$ with managers responsible for revenues, costs, and assets in their respective regions. The firm is highly decentralized and managers are evaluated solely on divisional performance. Corporate overhead $($all fixed$)$ is allocated to the regions based on regional gross margin $($regional revenue minus regional cost of sales$).$

The following information is from Lauderdale's first year of operations:

$\backslash$table$[[,,,,],[,,,$Total,$],[$Revenues$,$Region I,Region II$,$Region III,Corporation$],[$Cost of sales,$$1,206,000,$$$1,656,000,$$$2,256,000,$$$5,118,000$