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Raner, Harris and Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices-one in Chicago

image text in transcribed Raner, Harris and Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company's most recent year is given: Office Total Company Chicago Sales $ 450,000 100% Variable expenses 225,000 50% $ 150,000 45,000 100% Minneapolis $ 300,000 100% 30% 180,000 60% Contribution margin 225,000 50% 105,000 70% 120,000 40% Traceable fixed expenses. 126,000 28% Office segment margin 99,000 22% 78,000 $27,000 52% 48,000 16% 18% $ 72,000 24% Common fixed expenses not traceable to: offices 63,000 14% Net operating income $ 36,000 8% 3. Assume that sales in Chicago increase by $50,000 next year and that sales in Minneapolis remain unchanged. Assume no change in fixed costs. a. Prepare a new segmented income statement for the company. (Round your percentage answers to 1 decimal place (i.e. 0.1234 should be entered as 12.3).) Sales Variable expenses Contribution margin Segments Total Company Chicago Minneapolis Amount % Amount % Amount % 100.0 100.0 30.0 100.0 60.0 450,000 100.0 0 70.0 0 40.0

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