Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Need some help preparing a incremental analysis below, thanks Wildhorse Company has four operating divisions. During the first quarter of 2022, the company reported aggregate

Need some help preparing a incremental analysis below, thanks

image text in transcribedimage text in transcribed
Wildhorse Company has four operating divisions. During the first quarter of 2022, the company reported aggregate income from operations of $ 214,000 and the following divisional results. Division IV Sales $ 249,000 $ 200,000 $ 504,000 $ 450,000 Cost of goods sold 199,000 192,000 296,000 249,000 Selling and administrative expenses 76,000 63,000 64,000 50,000 Income (loss) from operations $ ( 26,000) $ ( 55,000) $ 144,000 $ 151,000 Analysis reveals the following percentages of variable costs in each division. IV Cost of goods sold 74 % 88 % 79 % 74 % Selling and administrative expenses 39 60 51 61 Discontinuance of any division would save 50% of the fixed costs and expenses for that division. Top management is very concerned about the unprofitable divisions (I and II). Consensus is that one or both of the divisions should be discontinued. (a) V Your answer is correct. Compute the contribution margin for Divisions | and II. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Division I Division II Contribution margin $ 72100 $ 6,760Prepare an incremental analysis concerning the possible discontinuance of Division I. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Net Income Continue Eliminate Increase (Decrease) Contribution margin $ $ $ Fixed costs Cost of goods sold Selling and administrative Total fixed expenses Income (loss) from $ $ operations

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Multicolumn Journal

Authors: Claudia Gilbertson

11th Edition

1337565423, 9781337565424

More Books

Students also viewed these Accounting questions

Question

What are the assumptions of the test based on the ????-ratio?

Answered: 1 week ago

Question

Annoyance about a statement that has been made by somebody

Answered: 1 week ago

Question

Self-confidence

Answered: 1 week ago