G Hmwk Segment Analysis O Not secure ezto.mheducation.com/hm.tpx Raner, Harris,
ID: 2339259 • Letter: G
Question
G Hmwk Segment Analysis O Not secure ezto.mheducation.com/hm.tpx Raner, Harris, & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs Assume that Minneapolis' sales by major market are: Dental 100% $300000 100% S 150,000 100% 75,000 50% Sales $450000 Varnable expenses 270,000 60% 195,000 65% 180,000 40% 105,000 35% 75,000 50% 39,000 26% Contribution margin 54,000 12% 15,000 5% Traceable fixed expenses Market segment margin Common fixed expenses 126,000 28% $90,000 30% S 36,000 24% not traceable to markets 13,500 3% Office segment margin $112.500 25% The company would like to initiate an intensive advertising campaign in one of the two market segments during the next month The campaign would cost $6,000. Marketing studies indicate that such a campaign would increase sales in the Medical market by $52,500 or increase sales in the Dental market by $45,000 Required: 1-a. Calculate the increased segment margin Increased segment margin 1-b In which of the markets would you recommend that the company focus its advertising campaign? - Medical Dental O lype here to searchExplanation / Answer
Hey there!
In this question we have to calculate the increased segment margin...let us start..
It is recommended to focus advertising campaign in Dental Segment since it has higher increased segment margin as compared to Medical division.
I hope the solution is now clear to you...do let me know in case of any concerns.
Particulars Total Medical Dental Sales 450,000 100% 300,000 100% 150,000 100% Variable Expenses -270,000 60% -195,000 65% -75,000 50% Contribution Margin 180,000 40% 105,000 35% 75,000 50% Fixed Expenses -54,000 12% -15,000 5% -39,000 26% Market Segment Margin 126,000 28% 90,000 30% 36,000 24% Common Fixed Expenses -13,500 3% Office Market Margin 112,500 25%Related Questions
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