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Raner, Harris & 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 & 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 Minneapolis Sales $ 477,000 Variable expenses 238,500 100.00% 50.00% $ 159,000 100.00% 47,700 30.00% $ 318,000 190,800 100.00% 60.00% Contribution margin 238,500 50.00% 111,300 70.00% 127,200 40.00% Traceable fixed expenses 133,560 28.00% 82,680 52.00% 50,880 16.00% Office segment margin 104,940 22.00% $ 28,620 18.00% $ 76,320 24.00% Common fixed expenses not traceable to offices 66,780 14.00% Net operating income $ 38,160 8.00% 3. Assume that sales in Chicago increase by $53,000 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 intermediate calculations and percentage answers to 1 decimal place (i.e. 0.1234 should be entered as 12.3 and other answers to the nearest whole dollar.)) Total Company Amount Segments Chicago Minneapolis % Amount % Amount % 0.0 0 0.0 0.0 0 0.0 $ 0 0.0 $ 0.0 $ 0 0.0
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