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The operations of Erin Corporation are divided into the Coral Division and the Cyan Division. Projections for the next year are as follows: Coral Cyan
The operations of Erin Corporation are divided into the Coral Division and the Cyan Division. Projections for the next year are as follows:
Coral | Cyan | ||
Division | Division | Total | |
Sales | $215,000 | $126,000 | $341,000 |
Variable costs | 75,500 | 55,000 | 130,500 |
Contribution margin | $139,500 | $ 71,000 | $210,500 |
Direct fixed costs | 60,000 | 50,000 | 110,000 |
Segment margin | $ 79,500 | $ 21,000 | $100,500 |
Allocated common costs | 32,000 | 40,000 | 72,000 |
Operating income (loss) | $ 47,500 | $(19,000) | $ 28,500 |
Operating income for Erin Corporation as a whole if the Cyan Division were dropped would be:
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