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Question: Please answer in the format below: 31. Segmented Net Income. Valdez Company has two divisions-Appliances and Tools. The following segmented financial information is for
Question:
Please answer in the format below:
31. Segmented Net Income. Valdez Company has two divisions-Appliances and Tools. The following segmented financial information is for the most recent fiscal year ended December 31. Sales Cost of goods sold Allocated overhead Selling and administrative expenses Assume the tax rate is 30 percent. Required: a. Prepare a segmented income statement using the format presented in Figure 11.3. Include the profit margin Appliances Division Tools Division $1,000,0oo 430,00O 125,000 200,00o $3,000,0oo 1,600,00o 375,000o 250,000 ratio for each division at the bottom of the segmented income statement. b. Using net income as the measure, which division is most profitable? Explain why this conclusion might be misleadin c. What does the profit margin ratio tell us about each division? Why do organizations often use profit margiin ratio to evaluate division performance rather than simply using net income
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