Segment Contribution Margin Analysis

Time Warner, Inc.

Segment Revenues

$($in millions$)$

Turner $($cable networks and digital media$)$

Home Box Office $($pay television$)$

Wamer Bros. $($films$,$ television, and videos$)$

$$45,900$

$27,300$

$86,400$

Assume that the variable costs as a percent of sales for each segment are as follows:

Turner

$28\%$

Home Box Office

$49\%$

Wamer Bros.

$34\%$ margin ratio to whole percents for each segment from the information given.

Revenues

Variable costs

Contribution margin

Contribution margin ratio $($as a percent$)$

b$.$ Does your answer to $($a$)$ mean that the other segments are more profitable businesses? volume,

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