100.00 points The Regal Cycle Company manufactures three types of bicycles-a dir

Question

100.00 points The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and bike. Data on sales and expenses for the past quarter follow a racing Racing Bikes Dirt Mountain Bikes 201,000 209.000 40,400 Total Bikes Sales $ 922,000 S 261,000 S 410,000 $251,000 118,000 159,000o Variable manufacturing and selting expenses Contribution margin Fxed expenses 478.000 444,000143,000 92,000 Advertising, traceable Depreciation of speciat equipment Sataries of product-ine managers Allocated common fixed expenses" 68,800 43.700 114, 700 184 400 8.200 21,000 40,400 20,200 15.500 35,600 200 7,200 82,000 50, Total fixed expenses 411 600121.800168,300121.500 Net operating income (loss) s 32.400 S 21.200$ 40,700 (29,500) Alocated on the basis of salos dollars Management is concerned about the contmued losses shown by the racing bikes and wants a produce racing bikes has no resale value and does not wear out Required to as to wmether or not the ine should be special 1a What is indicated by a minus sign.) pact on n a bikes? (De creases should be Difference: Net Operating Total I : e Dropped . or (Decrease) Total Racing Bikes income merease

Explanation / Answer

Total Total w/o Racing Diff Sales        9,22,000        6,71,000       -2,51,000 Variable Cost        4,78,000        3,19,000       -1,59,000 Contribution        4,44,000        3,52,000          -92,000 Fixed Expenses Advertising Tarceable            68,800            48,600          -20,200 Depreciation on Spl Eqip.            43,700            28,200          -15,500 Salaries of the Product line mgrs        1,14,700            79,100          -35,600 Allocated common Expenses        1,84,400        1,84,400 Total Fixed Expenses        4,11,600        3,40,300          -71,300 Net Operating Income/( Loss)            32,400            11,700          -20,700 Production and sales of the racing bike discontinued NO Total Dirt Bikes Mountain Bikes Racing Bikes Sales        9,22,000        2,61,000        4,10,000         2,51,000 Variable Cost        4,78,000        1,18,000        2,01,000         1,59,000 Contribution        4,44,000        1,43,000        2,09,000             92,000 Traceable Fixed Expenses Advertising Tarceable            68,800              8,200            40,400             20,200 Depreciation on Spl Eqip.            43,700            21,000              7,200             15,500 Salaries of the Product line mgrs        1,14,700            40,400            38,700             35,600 Allocated common Expenses Total Traceable Fixed Expenses        2,27,200            69,600            86,300             71,300 Segment wise profit        2,16,800            73,400        1,22,700             20,700 Non Taraceable Exp        1,84,400 Net Operating Income/( Loss)            32,400            73,400        1,22,700             20,700 Segment wise income statement more useful                     -   YES

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

---

---

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