Severo S.A. of Sao Paulo, Brazil, is organized into two divisions. The company's contribution format segmented income statement (in terms of the Brazilian currency, the real, R) for last month is given below. Divisions Cloth Sales Variable expenses Contribution margin Traceable fixed expenses: Advertising Selling and administrative Depreciation Total traceable fixed expenses Divisional segment margin Common fixed expenses Operating income Total Company Leather R 3,995,000 1,955,000 R 2,350,000 R 1,645,000 1,030,000 925,000 2,040,000 1,320,000 720,000 600,000 370,000 230,000 504,000 280,000 224,000 243,000 122,000 121,000 1,347,000 772,000 575,000 693,000 R 548,000 R 145,000 397,000 R 296,000