Oriole, Inc. operates three divisions, Weak, Average, and Strong. As it turns out, the Weak division has the lowest operating income, and the president wants to close it. “Survival of the fittest, I say!” was his response when the Weak division’s manager insisted that his division earned money for the company. Following is the most recent financial analysis for each division: Weak Average Strong Sales revenue $125,200 $349,800 $524,500 Variable expenses 55,000 192,300 302,200 Contribution margin 70,200 157,500 222,300 Direct expenses 32,900 75,100 116,600 Allocated expenses 59,800 59,800 59,800 Operating income $(22,500 ) $22,600 $45,900 (a) Prepare a revised income statement showing the segment margin for each division. Weak Average Strong Total Variable expenseOperating income Contribution margin Direct costs Allocated expenseSegment margin Sales $ $ $ $ Contribution margin Variable expenseOperating income Allocated expenseSales Segment margin Direct expense Sales Variable expenseOperating income Allocated expenseContribution margin Segment margin Direct expense Direct expenseSegment margin Sales Allocated expenseOperating income Variable expenseContribution margin Operating income Segment margin Variable expenseDirect expenseSales Contribution margin Allocated expense $ $ $ Variable expenseSales Contribution margin Direct expenseSegment margin Allocated expenseOperating income Contribution margin Segment margin Sales Direct expenseAllocated expenseVariable expenseOperating income $ Click if you would like to Show Work for this question: Open Show Work

Oriole, Inc. operates three divisions, Weak, Average, and Strong. As it turns out, the Weak division has the lowest operating income, and the president wants to close it. “Survival of the fittest, I say!” was his response when the Weak division’s manager insisted that his division earned money for the company. Following is the most recent financial analysis for each division: Weak Average Strong Sales revenue $125,200 $349,800 $524,500 Variable expenses 55,000 192,300 302,200 Contribution margin 70,200 157,500 222,300 Direct expenses 32,900 75,100 116,600 Allocated expenses 59,800 59,800 59,800 Operating income $(22,500 ) $22,600 $45,900 (a) Prepare a revised income statement showing the segment margin for each division. Weak Average Strong Total Variable expenseOperating income Contribution margin Direct costs Allocated expenseSegment margin Sales $ $ $ $ Contribution margin Variable expenseOperating income Allocated expenseSales Segment margin Direct expense Sales Variable expenseOperating income Allocated expenseContribution margin Segment margin Direct expense Direct expenseSegment margin Sales Allocated expenseOperating income Variable expenseContribution margin Operating income Segment margin Variable expenseDirect expenseSales Contribution margin Allocated expense $ $ $ Variable expenseSales Contribution margin Direct expenseSegment margin Allocated expenseOperating income Contribution margin Segment margin Sales Direct expenseAllocated expenseVariable expenseOperating income $ Click if you would like to Show Work for this question: Open Show Work

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter24: Evaluating Decentralized Operations

Section: Chapter Questions

Problem 3TIF: Communication The Norse Division of Gridiron Concepts Inc. experienced significant revenue and...

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(a)

Prepare a revised income statement showing the segment margin for each division.

	Weak	Average	Strong	Total
Variable expenseOperating income Contribution margin Direct costs Allocated expenseSegment margin Sales	$	$	$	$
Contribution margin Variable expenseOperating income Allocated expenseSales Segment margin Direct expense
Sales Variable expenseOperating income Allocated expenseContribution margin Segment margin Direct expense
Direct expenseSegment margin Sales Allocated expenseOperating income Variable expenseContribution margin
Operating income Segment margin Variable expenseDirect expenseSales Contribution margin Allocated expense	$	$	$
Variable expenseSales Contribution margin Direct expenseSegment margin Allocated expenseOperating income
Contribution margin Segment margin Sales Direct expenseAllocated expenseVariable expenseOperating income				$

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