Clemmens Corporation has two major business segments: Consumer and Commercial. D

Question

Clemmens Corporation has two major business segments: Consumer and Commercial. Data for the segments and for the company for August appear below:

  
In addition, common fixed expenses totaled $265,000 and were allocated as follows: $135,000 to the Consumer business segment and $130,000 to the Commercial business segment.

A properly constructed segmented income statement in a contribution format would show that the net operating income of the company as a whole is:

options:

$88,000

$353,000

$476,000

-$177,000

Sales revenues, Consumer $390,000 Sales revenues, Commercial $530,000 Variable expenses, Consumer $179,000 Variable expenses, Commercial $265,000 Traceable fixed expenses, Consumer $59,000 Traceable fixed expenses, Commercial $64,000

Explanation / Answer

Answer: A properly constructed segmented income statement in a contribution format would show that the net operating income of the company as a whole is $88,000

Particulars/Segment Consumer$ Commercial$ Total$ Sales Revenue 390,000 530,000 920,000 Less:Variable Expense 179,000 265,000 444,000 Contribution 211,000 265,000 476,000 Less:Traceable fixed expenses 59,000 64,000 123,000 Less:common fixed expenses 135,000 130,000 265,000 Net operating Income 17,000 71,000 88,000

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.