Marple Associates is a consulting firm that specializes in information systems for construction and landscaping companies. The firm has two offices%u2014one in Houston and one in Dallas. The firm classifies the direct costs of consulting jobs as variable costs. A segmented contribution format income statement for the company%u2019s most recent year is given below:

					Office
	Total Company				Houston				Dallas
Sales	$	450,000	100.0	%	$	90,000	100	%	$	360,000	100	%
Variable expenses		243,000	54.0			27,000	30			216,000	60
Contribution margin		207,000	46.0			63,000	70			144,000	40
Traceable fixed expenses		100,800	22.4			46,800	52			54,000	15
Office segment margin		106,200	23.6		$	16,200	18	%	$	90,000	25	%
Common fixed expenses not traceable to offices		72,000	16.0
Net operating income	$	34,200	7.6	%

Required:

1.	By how much would the company%u2019s net operating income increase if Dallas increased its sales by $45,000 per year? Assume no change in cost behavior patterns.

Increase in Net operating income

$

rev: 03_13_2013_QC_27117

2.	Refer to the original data. Assume that sales in Houston increase by $30,000 next year and that sales in Dallas remain unchanged. Assume no change in fixed costs.

Prepare a new segmented income statement for the company. (Round your percentage answers to 1 decimal place. Input all amounts as positive values except losses which should be indicated by a minus sign.)

			Segments
	Total Company		Houston		Dallas
	Amount	%	Amount	%	Amount	%
	$		$		$
			$		$
	$

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