Problem 12-44 Segmented Income Statement; Responsibility Accounting (LO 12-3, 12-5) Show-Off, Inc., sells merchandise through three retail outletsin Las Vegas, Reno, and Sacramento-and operates a general corporate headquarters in Reno. A review of the company's income statement indicates a record year in terms of sales and profits. Management, though, desires additional insights about the individual stores and has asked that Judson Wyatt, a newly hired intern, prepare a segmented income statement. The following information has been extracted from Show-Off's accounting records: The sales volume, sales price, and purchase price data follow: Las Vegas Reno Sacramento 37,300 units 41,300 units 46,120 units $ 21.00 $ 19.50 $ 17.25 Sales volume Unit selling price Unit purchase price 9.75 9.75 11.25 The following expenses were incurred for sales commissions, local advertising, property taxes, management salaries, and other noncontrollable (but traceable) costs: Sacramento 7% $81,000 9,900 Las Reno Vegas Sales commissions 7% 7% Local advertising $16,800 $34,500 Local property 6,900 3, 150 taxes Sales manager salary Store manager 48,000 61,500 salaries Other noncontrollable 9,000 7,050 costs 52,500 63,000 29,700 Local advertising decisions are made at the store manager level. The sales manager's salary in Sacramento is determined by the Sacramento store manager; in contrast, store manager salaries are set by Show-Off's vice president. Nontraceable fixed corporate expenses total $303,450. The company uses a responsibility accounting system. Required: 1. Assume the role of Judson Wyatt and prepare a segmented income statement for Show-Off. 2. Identify the probable causes for the poor performance of the weakest store. 3. Which of the following should be reviewed in evaluating the performance of the store manager? X Answer is not complete. Complete this question by entering your answers in the tabs below. Required Required Required 1 2 3 Assume the role of Judson Wyatt and prepare a segmented income statement for Show-Off. (R your answers to the nearest whole dollar.) Show-Off, Las Reno Sacramento Inc. Vegas $2,384,220$ 783,300 $ 805,350 $ 795,570 Sales revenue Variable operating expenses: Cost of goods sold Sales commissions $ $ 353,675 54,831 $ 402,675 56,375 518,850 55,690 166,895 $ 1,452,095 $ 932,125 $ 418,506 $ 354,794 $ 459,050 $ 346,300 $ $ 574,540 221,030 Total Segment contribution margin Fixed expenses controllable by segment manager: Local advertising Sales manager salary $ 16,800 $ 34,500 $ $ 132,300 52,500 81,000 52,500 $ 184,800 $ $ 16,800 $ 347,994 $ 34,500 $ 311,800 133,500 87,530 $ 747,325 $ Total Profit margin controllable by segment manager Fixed expenses traceable to segment, but controllable by others: Local property taxes Store manager salaries Other noncontrollable costs $ $ $ $ 19,950 172,500 45,750 6,900 48,000 9,000 3,150 61,500 7,050 9,900 63,000 29,700 $ 238,200 $ 509,125 $ 63,900 $ 284,094 $ 71,700 $ 240,100 $ $ 102,600 (15,070) Total Segment profit margin Common fixed expenses Operating income $ 509,125 Problem 12-44 Segmented Income Statement; Responsibility Accounting (LO 12-3, 12-5) Show-Off, Inc., sells merchandise through three retail outletsin Las Vegas, Reno, and Sacramento-and operates a general corporate headquarters in Reno. A review of the company's income statement indicates a record year in terms of sales and profits. Management, though, desires additional insights about the individual stores and has asked that Judson Wyatt, a newly hired intern, prepare a segmented income statement. The following information has been extracted from Show-Off's accounting records: The sales volume, sales price, and purchase price data follow: Las Vegas Reno Sacramento 37,300 units 41,300 units 46,120 units $ 21.00 $ 19.50 $ 17.25 Sales volume Unit selling price Unit purchase price 9.75 9.75 11.25 The following expenses were incurred for sales commissions, local advertising, property taxes, management salaries, and other noncontrollable (but traceable) costs: Sacramento 7% $81,000 9,900 Las Reno Vegas Sales commissions 7% 7% Local advertising $16,800 $34,500 Local property 6,900 3, 150 taxes Sales manager salary Store manager 48,000 61,500 salaries Other noncontrollable 9,000 7,050 costs 52,500 63,000 29,700 Local advertising decisions are made at the store manager level. The sales manager's salary in Sacramento is determined by the Sacramento store manager; in contrast, store manager salaries are set by Show-Off's vice president. Nontraceable fixed corporate expenses total $303,450. The company uses a responsibility accounting system. Required: 1. Assume the role of Judson Wyatt and prepare a segmented income statement for Show-Off. 2. Identify the probable causes for the poor performance of the weakest store. 3. Which of the following should be reviewed in evaluating the performance of the store manager? X Answer is not complete. Complete this question by entering your answers in the tabs below. Required Required Required 1 2 3 Assume the role of Judson Wyatt and prepare a segmented income statement for Show-Off. (R your answers to the nearest whole dollar.) Show-Off, Las Reno Sacramento Inc. Vegas $2,384,220$ 783,300 $ 805,350 $ 795,570 Sales revenue Variable operating expenses: Cost of goods sold Sales commissions $ $ 353,675 54,831 $ 402,675 56,375 518,850 55,690 166,895 $ 1,452,095 $ 932,125 $ 418,506 $ 354,794 $ 459,050 $ 346,300 $ $ 574,540 221,030 Total Segment contribution margin Fixed expenses controllable by segment manager: Local advertising Sales manager salary $ 16,800 $ 34,500 $ $ 132,300 52,500 81,000 52,500 $ 184,800 $ $ 16,800 $ 347,994 $ 34,500 $ 311,800 133,500 87,530 $ 747,325 $ Total Profit margin controllable by segment manager Fixed expenses traceable to segment, but controllable by others: Local property taxes Store manager salaries Other noncontrollable costs $ $ $ $ 19,950 172,500 45,750 6,900 48,000 9,000 3,150 61,500 7,050 9,900 63,000 29,700 $ 238,200 $ 509,125 $ 63,900 $ 284,094 $ 71,700 $ 240,100 $ $ 102,600 (15,070) Total Segment profit margin Common fixed expenses Operating income $ 509,125