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SB Exercise 6-16 through Exercise 6-17 (Static) [The following information applies to the questions displayed below.) Raner, Harris & Chan is a consulting firm that
SB Exercise 6-16 through Exercise 6-17 (Static) [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 $ 450,000 1001 225,000 500 225.000 501 126,000 288 99,000 22 Chicago $ 150,000 45,000 105,000 78,000 $ 27,000 Office Minneapolis 1001 $ 300,000 1008 300 180.000 608 703 120,000 401 528 48,000 168 188 $72,000 241 63.000 $ 36,000 140 81 Exercise 6-16 Part 2 (Static) Working with a Segmented Income Statement; Break-Even Analysis (L06-4, LO6-5) 2. By how much would the company's net operating income increase if Minneapolis increased its sales by $75,000 per year? Assume no change in cost behavior patterns. Answer is complete but not entirely correct. Not operating income increase s 37.500 ca Dr. . HH Next >
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