Koen Corporation has two divisions: Division A and Division B. Last month, the c
ID: 2416478 • Letter: K
Question
Koen Corporation has two divisions: Division A and Division B. Last month, the company reported a contribution margin of $40,000 for Division A. Division B had a contribution margin ratio of 40% and its sales were $200,000. Net operating income for the company was $27,000 and traceable fixed expenses were $50,000. Koen Corporation's common fixed expenses were:
$43,000
$50,000
$93,000
$120,000
Koen Corporation has two divisions: Division A and Division B. Last month, the company reported a contribution margin of $40,000 for Division A. Division B had a contribution margin ratio of 40% and its sales were $200,000. Net operating income for the company was $27,000 and traceable fixed expenses were $50,000. Koen Corporation's common fixed expenses were:
Explanation / Answer
contribution margin of division A = $ 40000
contirbution margin of division B = 40% , sales = $200000
contibution margin = $80000
total contribution margin = $120000
Traceable fixed expenses = 50000
Less net income of company = 27000
total contribution margin- traceable fixed cost - common fixed cost = net income
120000 - 50000 - common fixed cost = 27000
common fixed cost = $43000
ANSWER = A) $43000
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