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The company Gaviota produces two kinds of products, namely product A and product B. The segmented income statement of the company shows sales of product
The company "Gaviota" produces two kinds of products, namely product A and product B. The segmented income statement of the company shows sales of product A 700,000 and product B 1,800,000. The total variable cost of product A is 350,000 and product B is 1,000,000, so the contribution margin for product A is 350,000 and product B is 800,000. The total fixed costs of 600,000 consist of 66% direct fixed costs and 34% shared fixed costs. Proportion of direct fixed costs for product A:B = 1:2. The margin for product segment B is
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