Music Teachers, Inc., is an educational association for music teachers that has 20,400 members. The association operates from a central headquarters but has local membership chapters throughout the United States. Monthly meetings are held by the local chapters to discuss recent developments on topics of interest to music teachers. The association's journal, Teachers' Forum, is issued monthly with features about recent developments in the field. The association publishes books and reports and also sponsors professional courses that qualify for continuing professional education credit. The association's statement of revenues and expenses for the current year is presented beloww. Music Teachers, Inc. Statement of Revenues and Expenses For the Year Ended November 30 S3,355,500 Salaries Personnel costs Occupancy costs Reimbursement of member costs to local chapters Other membership services Printing and paper Postage and shipping Instructors fees General and administrative 997,000 249,250 283,000 570,000 550,000 346,000 242,000 70,000 35,000 Total expenses 3,342,250 Excess of revenues over expenses S 13,250 The board of directors of Music Teachers, Inc., has requested that a segmented income statement be prepared showing the contribution of each segment to the association. The association has four segments: Membership Division, Magazine Subscriptions Division, Books and Reports Division, and Continuing Education Division. Mike Doyle has been assigned responsibility for preparing the segmented income statement, and he has gathered the following data prior to its preparation. a. Membership dues are S100 per year, of which $20 is considered to cover a one-year subscription to the association's journal. Other benefits include membership in the association and chapter affiliation. The portion of the dues covering the magazine subscription ($20) should be assigned to the Magazine Subscription Division. b. One-year subscriptions to Teachers' Forum were sold to nonmembers and libraries at S30 per subscription. A total of 2,700 of these subscriptions were sold last year. In addition to subscriptions, the magazine generated S102,000 in advertising revenues. The costs per magazine subscription were S8 for printing and paper and $4 for postage and shipping c. A total of 28,600 technical reports and professional texts were sold by the Books and Reports Division at an average unit selling price of $25. Average costs per publication were S4 for printing and paper and $2 for postage and shipping d. The association offers a variety of continuing education courses to both members and nonmembers. The one-day courses had a tuition cost of $75 each and were attended by 2,400 students. A total of 1,900 students took two-day courses at a tuition cost of $125 for each student. Outside instructors were paid to teach some courses. e. Salary costs and space occupied by division follow: ace Occupied Salaries (square feet) S 213,000 3,000 1,000 1,000 198,000 2,000 97,000 3.000 151,000 1, 338,000 1 Magazine S Books and Reports Corporate staff Total S 997,000 10,000 Personnel costs are 25% of salaries in the separate divisions as well as for the corporate staff. The $283,000 in occupancy costs includes S53,000 in rental cost for a warehouse used by the Books and Reports Division for storage purposes. f. Printing and paper costs other than for magazine subscriptions and for books and reports relate to the g. General and administrative expenses include costs relating to overall administration of the association as a whole. The company's corporate staff does some mailing of materials for general administrative purposes. The expenses that can be traced or assigned to the corporate staff, as well as any other expenses that are not traceable to the segments, will be treated as common costs. It is not necessary to distinguish between variable and fixed costs