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products. Required: i. Prepare contribution format segmented income statements first showing the total company broken down between sales territories and then showing the Northern territory broken down by product line. In addition, for the company as a whole and for each segment, show each item on the segmented income statements as a percent of sales. ii. Look at the statement you have prepared showing the total company segmented by sales territory. What insights revealed by this statement should be brought to the attention of management? iii. Look at the statement you have prepared showing the Northern territory segmented by product lines. What insights revealed by this statement should be brought to the attention of management?

products. Required: i. Prepare contribution format segmented income statements first showing the total company broken down between sales territories and then showing the Northern territory broken down by product line. In addition, for the company as a whole and for each segment, show each item on the segmented income statements as a percent of sales. ii. Look at the statement you have prepared showing the total company segmented by sales territory. What insights revealed by this statement should be brought to the attention of management? iii. Look at the statement you have prepared showing the Northern territory segmented by product lines. What insights revealed by this statement should be brought to the attention of management?

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter7: Variable Costing For Management analysis
Section: Chapter Questions
Problem 9E: The following data were adapted from a recent income statement of Caterpillar Inc. (CAT) for the...
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products. Required: Prepare contribution format segmented income statements first showing the total company broken down between sales territories and then showing the Northern territory broken down by product line. In addition, for the company as a whole and for each segment, show each item on the segmented income statements as a percent of sales. ii. Look at the statement you have prepared showing the total company segmented by sales territory. What insights revealed by this statement should be brought to the attention of management? iii. Look at the statement you have prepared showing the Northern territory segmented by product lines. What insights revealed by this statement should be brought to the attention of management?
Transcribed Image Text:products. Required: Prepare contribution format segmented income statements first showing the total company broken down between sales territories and then showing the Northern territory broken down by product line. In addition, for the company as a whole and for each segment, show each item on the segmented income statements as a percent of sales. ii. Look at the statement you have prepared showing the total company segmented by sales territory. What insights revealed by this statement should be brought to the attention of management? iii. Look at the statement you have prepared showing the Northern territory segmented by product lines. What insights revealed by this statement should be brought to the attention of management?
(c) Vulcan Company's contribution format income statement for June is given below: Vulcan Company Income Statement For the Month Ended June 30 Sales Tk. 750,000 Variable Expenses Contribution Margin Fixed Expenses 336,000 414,000 378,000 $36,000 Net Operating Income Management is disappointed with the company's performance and is wondering what can be done to improve profits. By examining sales and cost records, you have determined the following: The company is divided into two sales territories-Northern and Southern. The Northern territory recorded Tk. 300,000 in sales and Tk. 156,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern territory. Fixed expenses of Tk. 120,000 and Tk. 108,000 are traceable to the Northern and Southern territories, respectively. The rest of the fixed expenses are common to the two territories. а. b. The company is the exclusive distributor for two products-Paks and Tibs. Sales of Paks and Tibs totalled Tk. 50,000 and Tk. 250,000, respectively, in the Northern territory during June. Variable expenses are 22% of the selling price for Paks and 58% for Tibs. Cost records show that Tk. 30,000 of the Northern territory's fixed expenses are traceable to Paks and tk. 40,000 to Tibs, with the remainder common to the two
Transcribed Image Text:(c) Vulcan Company's contribution format income statement for June is given below: Vulcan Company Income Statement For the Month Ended June 30 Sales Tk. 750,000 Variable Expenses Contribution Margin Fixed Expenses 336,000 414,000 378,000 $36,000 Net Operating Income Management is disappointed with the company's performance and is wondering what can be done to improve profits. By examining sales and cost records, you have determined the following: The company is divided into two sales territories-Northern and Southern. The Northern territory recorded Tk. 300,000 in sales and Tk. 156,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern territory. Fixed expenses of Tk. 120,000 and Tk. 108,000 are traceable to the Northern and Southern territories, respectively. The rest of the fixed expenses are common to the two territories. а. b. The company is the exclusive distributor for two products-Paks and Tibs. Sales of Paks and Tibs totalled Tk. 50,000 and Tk. 250,000, respectively, in the Northern territory during June. Variable expenses are 22% of the selling price for Paks and 58% for Tibs. Cost records show that Tk. 30,000 of the Northern territory's fixed expenses are traceable to Paks and tk. 40,000 to Tibs, with the remainder common to the two
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