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Niangua Co. is divided into three segments and is interested in preparing a segmented income statement in order to better understand the operating performance of
Niangua Co. is divided into three segments and is interested in preparing a segmented income statement in order to better understand the operating performance of each segment. Fixed expenses in each division currently include an allocation of general corporate expenses equal to 20% of the division's sales.
Division 1 | Division 2 | Division 3 | ||||||||
Sales | $ | 320,000 | $ | 200,000 | $ | 280,000 | ||||
Variable expenses | 208,000 | 120,000 | 152,000 | |||||||
Contribution margin | $ | 112,000 | $ | 80,000 | $ | 128,000 | ||||
Fixed expenses | 80,000 | 88,000 | 72,000 | |||||||
Net income (loss) | $ | 32,000 | $ | (8,000 | ) | $ | 56,000 | |||
(a.) Complete the following segmented income statement for Niangua Co.
Total Company | Division 1 | Division 2 | Division 3 | |
Sales | ||||
Variable expenses | ||||
Contribution margin | ||||
Direct fixed expenses | ||||
Segment margin | ||||
Common fixed expenses | ||||
Net income (loss) |
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