Microsoft Corporation has three segments: Productivity and Business Processes, Intelligent Cloud, and More Personal Computing. The following information is provided for 2023:

• Productivity and Business Processes: Sales $1,500,000, Variable Costs $700,000, Fixed Costs $400,000
• Intelligent Cloud: Sales $1,200,000, Variable Costs $600,000, Fixed Costs $300,000
• More Personal Computing: Sales $1,000,000, Variable Costs $500,000, Fixed Costs $250,000

Required:

1. Prepare a segmented income statement.
2. Calculate the contribution margin for each segment.
3. Analyze the profitability of each segment and suggest improvements.
4. Discuss the importance of segment reporting in financial analysis and decision-making.