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Question 47 of 50 Condensed monthly operating income data for Company A for May follow: 6 Points Total Segment 1 Segment 2 Sales P
Question 47 of 50 Condensed monthly operating income data for Company A for May follow: 6 Points Total Segment 1 Segment 2 Sales P 200,000 P 80,000 P 120,000 Variable expenses 116,000 32,000 84,000 Contribution Margin 84,000 48,000 36,000 Traceable Fixed Expenses 60,000 20,000 40,000 Segment Margin 24,000 P 28,000 P (4,000) Common Fixed Expenses 10,000 Net Operating Income P 14,000 One-fourth of each segment's direct fixed costs would continue if either segment is closed. Management estimates that closing Segment 2 would result in a 10% decrease in Segment 1's sales, whereas closing Segment 1 would not affect Segment 2's sales. The operating results for May are representative of all months. Company A is considering a promotional campaign at Segment 2 that would not affect Segment 1. Increasing annual promotional expense at Segment 2 by P60,000 in order to increase this segment's sales by 10% would result in a monthly increase (decrease) in Company A's operating income during the year of Answer with text and/or attachments
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