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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
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 glven: Sales Variable expenses Contribution margin Traceable fixed expenses office segment margin Common fixed expenses not traceable to offices Total Company 472,500 100.00 236,250 50.00 236,250 50.00 132,300 28.00 103,950 22.00 office Chicago Minneapolis 157,500 100.00315,000 100.00 47,250 30.00 189,000 60.00 110,250 70.00 126,000 40.00 81,900 52.00 50,400 16.00 28,350 18.0075,600 24.00 66,15014.008
a. Compute the companywide break-even point in dollar sales. 1-b. Compute the break-even point for the Chicago office and for the Minneapolis office. 1-Is the companywide break-even point greater than, less than, or equal to the sum of the Chicago and Minneapolis break-even points?
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