P24-3l. Multiple Segment Reports Worldwide Communications. Incorporated, sells telecommunication products throughout the world in three sales territories: Europe, Asia. and the Americas. For July, all $945,000 of administrative expense is traceable to the territories. except $200,000. which is common to all units and cannot be traced or al- located to the sales territories. The percentage of product line sales made in each of the sales territories and the assignment of traceable fixed expenses follow: Sales Territory Europe Asia Handset sales .................. 40% 35% Switchboard sales .............. 35% 35% Automated switches sales ........ 10% 15% Fixed administrative expense ...... $350,000 $275,000 Fixed selling expense ............ $155,000 $175,000 The manufacturing takes place in one large facility with three distinct manufacturing operations. Selected product-line cost data follow. The Americas 25% 30% 75% $220,000 $550,000 Company 100% 100% 100% $845,000 $880,000 Automated Handset Switchboard Switches Company Variable costs ...................... $ 15 $ 850 $ 1,950 Depreciation and supervision .......... 60,000 175,000 275,000 $ 585,000* Other mfg. overhead (common) .............................................. 650,000 Fixed administrative expense (common) ....................................... 1,045,000 Fixed selling expense (common) ............................................. 880,000 *lncludes common costs of $75,000 The unit sales and selling prices for each product follow. Selling Unit Sales Price Handset ............................................... 6,500 $ 25 Switchboard ............................................ 1,500 1,900 Automated ............................................. 2,500 3,500 Required a. b. Prepare an income statement for July segmented by product line. Include a column for the entire firm. Prepare an income statement for July segmented by sales ten'itory. Include a column for the entire firm. Prepare an income statement for July by product line for The Americas sales territory. Include a column for the territory as a whole. Products are manufactured in a single facility. Although de- preciation and supervision are allocated by product line, those costs are not allocated by territory. Discuss the value of multilevel segment reporting as a managerial tool. Compare and contrast the benefits of the reports generated in parts a, b, and c