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! Required information [The following information applies to the questions displayed below. Raner, Harris & Chan is a consulting firm that specializes in information systems
! Required information [The following information applies to the questions displayed below. 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: Sales Variable expenses Contribution margin Traceable fixed expenses Office segment margin Common fixed expenses not traceable to offices Net operating income Total Company $ 458,000 100% 228,600 50% 229,400 50% 128, 720 28% 100,680 22% 64, 120 14% $ 36,560 8% Office Chicago Minneapolis $ 154,000 100% $ 304,000 100% 46,200 30% 182,400 60% 107,800 70% 121,600 40% 80,080 52% 48,640 16% $ 27,720 18% $ 72,960 24% 2. By how much would the company's net operating income increase if Minneapolis increased its sales by $77,000 per year? Assume no change in cost behavior patterns. Net operating income increase 3. Assume that sales in Chicago increase by $52,000 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.)) Segments Total Company Chicago Minneapolis Amount % Amount % Amount % 0 0.0 0 0.0 0 0.0 0 0.0 $ 0 0.0 $ 0 0.0 $ 0 0.0
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