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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 for
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 officesone 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 $ 477,000 100% 243,000 50% 234,000 50% 129,600 28% 104,400 22% 67,500 14% $ 36,900 8% Office Chicago Minneapolis $ 163,500 100% $ 313,500 1% 54,000 30% 188, 100 60% 109,500 70% 125,400 40% 79,800 52% 50, 160 16% $ 29,700 18% $ 75,240 24% Required: 1-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-c. Is the companywide break-even point greater than, less than, or equal to the sum of the Chicago and Minneapolis break-even points? Complete this question by entering your answers in the tabs below. Show less A Reg 1A Reg 1B Req 1C Compute the companywide break-even point in dollar sales. (Round "CM ratio" to 2 decimal places and final answer to the nearest whole number.) Break-even point in dollar sales Req 1A Req 1B > 3. Assume that sales in Chicago increase by $54,500 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 Breakeven point in doller sales Fixed cost contribution per unit Rate answer here $ Fixed cost (Tracable plus fixed) Contribution % 197,100 50% 1A $ 197,100 50% Breakeven point in doller sales II $ 394,200 Chicago office Minneapolis office $ $ Fixed cost (tracable) Contribution % 79,800 70% 50, 160 40% 1B $ $ 79,800 70% 50,160 40% Breakeven point in doller sales = $ 114,000 $ 125,400 1C Company wide breakeven point is greater than chicago and minneapolis office 2 $ Increase in sales Contribution % Increase in net operating income 79,500 40% 31,800 $
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