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The following information was taken from the segmented income statement of Restin, Inc., and the company's three divisions: Revenues Variable operating expenses Controllable fixed expenses
The following information was taken from the segmented income statement of Restin, Inc., and the company's three divisions: Revenues Variable operating expenses Controllable fixed expenses Noncontrollable fixed expenses Restin, Inc. $1,000,000 554, 000 240,000 90,000 Los Angeles Division $280,000 154,000 75,000 25,000 Bay Area Division $315,000 170,000 85,000 30,000 Central Valley Division $405,000 230,000 80,000 35,000 In addition, the company incurred common fixed costs of $21,000. Assume that the Los Angeles division increases its promotion expense, a controllable fixed cost, by $19.000. As a result, revenues increased by $58,800. If variable expenses are tied directly to revenues, the new Los Angeles segment contribution margin is: Multiple Choice $60,000. 541.000. 533,460. $79,000 553.000
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