6. TB 170 Stryker Corporation has two major business segments-East and West. In

Question

6.
TB 170 Stryker Corporation has two major business segments-East and West. In April, the East business segment had sales revenues of $500,000, variable expenses of $280,000, and traceable fixed expenses of $80,000. During the same month, the West business segment had sales revenues of $970,000, variable expenses of $514,000, and traceable fixed expenses of $184,000. The common fixed expenses totaled $280,000 and were allocated as follows: $112,000 to the East business segment and $168,000 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:
A) $108,000
B) $28,000
C) $140,000
D) $280,000

7.
TB 147 Vanstee Corporation manufactures a variety of products. Variable costing net operating income last year was $60,000 and this year was $67,000. Last year, $37,000 in fixed manufacturing overhead costs were deferred in inventory under absorption costing. This year, $8,000 in fixed manufacturing overhead costs were released from inventory under absorption costing.

What was the absorption costing net operating income this year?
A) $38,000
B) $96,000
C) $75,000
D) $59,000
8.
TB 25 Under variable costing, costs that are treated as period costs include:
TB 25 Under variable costing, costs that are treated as period costs include:
A) only fixed manufacturing costs.
B) both variable and fixed manufacturing costs.
C) all fixed costs.
D) only fixed selling and administrative costs.

10TB 89 Abe Company, which has only one product, has provided the following data concerning its most recent month of operations:

Explanation / Answer

1The salary paid to a store manager is a traceable fixed expense of the store. A) True 2. In segment reporting, sales dollars is usually an appropriate allocation base for selling, general, and administrative expenses. B)True 3.Fixed costs that are traceable to a segment may become common if the segment is divided into smaller units. B) False 4. D) $169,200 5.D) $21,000 6.C) $140,000 7.B) $96,000 8.C) all fixed costs. 9.C) $37 10.C) $81

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