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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 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 $ 412,500 100.0% 222,750 54.0% 189,750 46.0% 92,400 22.4% 97,350 23.6% 66,000 16.0% $ 31,350 7.6% Office Chicago Minneapolis $ 82,500 100% $ 330,000 100% 24,750 30% 198,000 60% 57,750 70% 132,000 40% 42,900 52% 49,500 15% 14,850 18% $ 82,500 25% 2. By how much would the company's net operating income increase if Minneapolis increased its sales by $41,250 per year? Assume no change in cost behavior patterns. Net operating income increase
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