Spiess Corporation has two major business segments--Apparel and Accessories. Dat
ID: 2590658 • Letter: S
Question
Spiess Corporation has two major business segments--Apparel and Accessories. Data concerning those segments for December appear below:
Common fixed expenses totaled $418,000 and were allocated as follows: $219,000 to the Apparel business segment and $199,000 to the Accessories business segment.
Required:
Prepare a segmented income statement in the contribution format for the company.
Sales revenues, Apparel Variable expenses, Apparel Traceable fixed expenses, Apparel Sales revenues, Accessories Variable expenses, Accessories Traceable fixed expenses, Accessories $770,00e $303,00e $107,00e $826,00e $458,00e $155,00eExplanation / Answer
Solution:
Segmented Income Statement
contribution format for the company
Total Company
Apparel
Accessories
Sales Revenue (A)
$1,596,000
$770,000
$826,000
Variable Expenses (B)
$761,000
$303,000
$458,000
Contribution Margin (C=A-B)
$835,000
$467,000
$368,000
Traceable fixed expenses (D)
$262,000
$107,000
$155,000
Segment Margin (E = C-D)
$573,000
$360,000
$213,000
Common fixed expenses (F)
$418,000
Net operating income (loss) (E-F)
$155,000
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Segmented Income Statement
contribution format for the company
Total Company
Apparel
Accessories
Sales Revenue (A)
$1,596,000
$770,000
$826,000
Variable Expenses (B)
$761,000
$303,000
$458,000
Contribution Margin (C=A-B)
$835,000
$467,000
$368,000
Traceable fixed expenses (D)
$262,000
$107,000
$155,000
Segment Margin (E = C-D)
$573,000
$360,000
$213,000
Common fixed expenses (F)
$418,000
Net operating income (loss) (E-F)
$155,000
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