Question
Tubaugh Corporation has two major business segments--East and West. In December, the East business segment had sales revenues of $370,000, variable expenses of $200,000, and
Tubaugh Corporation has two major business segments--East and West. In December, the East business segment had sales revenues of $370,000, variable expenses of $200,000, and traceable fixed expenses of $44,000. During the same month, the West business segment had sales revenues of $1,040,000, variable expenses of $532,000, and traceable fixed expenses of $199,000. The common fixed expenses totaled $306,000 and were allocated as follows: $153,000 to the East business segment and $153,000 to the West business segment.
A properly constructed segmented income statement in a contribution format would show that the segment margin of the East business segment is:
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$(27,000)
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$(17,000)
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$200,000
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$126,000
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