Question
Vulcan Companys contribution format income statement for June is as follows: Vulcan Company Income Statement For the Month Ended June 30 Sales $ 800,000 Variable
Vulcan Companys contribution format income statement for June is as follows:
Vulcan Company Income Statement For the Month Ended June 30 | |
Sales | $ 800,000 |
---|---|
Variable expenses | 308,000 |
Contribution margin | 492,000 |
Fixed expenses | 455,000 |
Net operating income | $ 37,000 |
Management is disappointed with the companys performance and is wondering what can be done to improve profits. By examining sales and cost records, you have determined the following:
The company is divided into two sales territoriesNorthern and Southern. The Northern Territory recorded $400,000 in sales and $248,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern Territory. Fixed expenses of $140,000 and $84,000 are traceable to the Northern and Southern Territories, respectively. The rest of the fixed expenses are common to the two territories.
Prepare contribution format segmented income statements for the total company broken down between sales territories. (Round the percentage answers to one decimal place (i.e.1234 should be entered as 12.3).)Step by Step Solution
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