Brabant NV of the Netherlands is a wholesale distributor of Dutch cheeses that it sells throughout the European Community. Unfortunately, the company's profits have been declining, which has caused considerable concern. To help understand the condition of the company. the managing director of the company has requested that the monthly income statement be segmented by sales territory. Accordingly, the company's accounting department has prepared the following statement for March, the most recent month. (The Dutch currency is the euro which is designated by €.) Sales Territory Southern Middle Northern Europe Europe Europe Sales €300,000 €800,000 €700,00 Territorial expenses (traceable): Cost of goods sold 93,000 240,000 315,000 Salaries 54,000 56,000 112,000 Insurance 9,000 16,000 14,000 Advertising Depreciation Shipping 105,000 240,000 245,000 21,000 32,000| 28,000 15,000 32,000| 42,000 297,000 616,000 756,000 Total territorial expenses Territorial income (loss) 3,000 184,000 (56,000) before corporate expenses
Brabant NV of the Netherlands is a wholesale distributor of Dutch cheeses that it sells throughout the European Community. Unfortunately, the company's profits have been declining, which has caused considerable concern. To help understand the condition of the company. the managing director of the company has requested that the monthly income statement be segmented by sales territory. Accordingly, the company's accounting department has prepared the following statement for March, the most recent month. (The Dutch currency is the euro which is designated by €.) Sales Territory Southern Middle Northern Europe Europe Europe Sales €300,000 €800,000 €700,00 Territorial expenses (traceable): Cost of goods sold 93,000 240,000 315,000 Salaries 54,000 56,000 112,000 Insurance 9,000 16,000 14,000 Advertising Depreciation Shipping 105,000 240,000 245,000 21,000 32,000| 28,000 15,000 32,000| 42,000 297,000 616,000 756,000 Total territorial expenses Territorial income (loss) 3,000 184,000 (56,000) before corporate expenses
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter10: Evaluating Decentralized Operations
Section: Chapter Questions
Problem 2TIF
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