Required information[The following information applies to the questions displayed below.]Raner, Harris & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm hastwo offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variablecosts. A contribution format segmented income statement for the company's most recent year is given:OfficeTotal CompanyChicagoMinneapolis$ 420,000$ 525,000283,500241,500Sales100.0%$ 105,000100%100%Variable expenses54.0%31,50030%252,00060%Contribution marginTraceable fixed expenses70%52%46.0%73,50054,600168,00063,00040%117, 60022.4%15%Office segment margin123,90023.6%$18,90018%$ 105,00025%84,000$4Common fixed expenses not traceable to offices16.0%Net operating income39,9007.6%2. By how much would the company's net operating income increase if Minneapolis increased its sales by $52,500 per year? Assumeno change in cost behavior patterns.Net operating income increase

Minneapolis contribution margin ratio = 40% Increase In sales = $ 52500

Required information [The following information applies to the questions displayed below.] Raner, Harris & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company's most recent year is given: Office Total Company $ 525,000 283, 500 241,500 117,600 Chicago $ 105,000 31,500 73,500 Minneapolis $ 420,000 252,000 168,000 Sales 100.0% 100% 100% Variable expenses Contribution margin Traceable fixed expenses 54.0% 46.0% 30% 60% 70% 40% 22.4% 54,600 52% 63,000 15% Office segment margin 123,900 23.6% 18,900 18% $ 105,000 25% Common fixed expenses not traceable to offices 84,000 16.0% Net operating income 2$ 39,900 7.6% 2. By how much would the company's net operating income increase if Minneapolis increased its sales by $52,500 per year? Assume no change in cost behavior patterns. Net operating income increase

Required information [The following information applies to the questions displayed below.] Raner, Harris & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company's most recent year is given: Office Total Company $ 525,000 283, 500 241,500 117,600 Chicago $ 105,000 31,500 73,500 Minneapolis $ 420,000 252,000 168,000 Sales 100.0% 100% 100% Variable expenses Contribution margin Traceable fixed expenses 54.0% 46.0% 30% 60% 70% 40% 22.4% 54,600 52% 63,000 15% Office segment margin 123,900 23.6% 18,900 18% $ 105,000 25% Common fixed expenses not traceable to offices 84,000 16.0% Net operating income 2$ 39,900 7.6% 2. By how much would the company's net operating income increase if Minneapolis increased its sales by $52,500 per year? Assume no change in cost behavior patterns. Net operating income increase

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

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Raner, Harris & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Assume that Minneapolis’ sales by major market are: Market Minneapolis Medical Dental Sales $ 870,000 100 % $ 580,000 100 % $ 290,000 100 % Variable expenses 522,000 60 % 377,000 65 % 145,000 50 % Contribution margin 348,000 40 % 203,000 35 % 145,000 50 % Traceable fixed expenses 104,400 12 % 29,000 5 % 75,400 26 % Market segment margin 243,600 28 % $ 174,000 30 % $ 69,600 24 % Common fixed expensesnot traceable to markets 26,100 3 % Office segment margin $ 217,500 25 % The company would like to initiate an intensive advertising campaign in…
Raner, Harris & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Total Company Office Chicago Minneapolis Sales $ 508,500 100.00% $ 169,500 100.00% $ 339,000 100.00% Variable expenses 254,250 50.00% 50,850 30.00% 203,400 60.00% Contribution margin 254,250 50.00% 118,650 70.00% 135,600 40.00% Traceable fixed expenses 142,380 28.00% 88,140 52.00% 54,240 16.00% Office segment margin 111,870 22.00% $ 30,510 18.00% $ 81,360 24.00% Common fixed expenses not traceable to offices 71,190 14.00% Net operating income $ 40,680 8.00% rev: 06_09_2020_QC_CS-215744, 09_15_2020_QC_CS-220558, 11_04_2020_QC_CS-238526, 03_30_2021_QC_CS-258090 Exercise 6-17 (Algo) Working with…
Raner, Harris and Chan is a consulting firm specializing in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. It classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given below: Total Company Office Chicago Minneapolis Sales $ 490,500 100.00% $ 163,500 100.00% $ 327,000 100.00% Variable expenses 245,250 50.00% 49,050 30.00% 196,200 60.00% Contribution margin 245,250 50.00% 114,450 70.00% 130,800 40.00% Traceable fixed expenses 137,340 28.00% 85,020 52.00% 52,320 16.00% Office segment margin 107,910 22.00% $ 29,430 18.00% $ 78,480 24.00% Common fixed expenses not traceable to offices 68,670 14.00% Net operating income $ 39,240 8.00% 2. How much would the company’s net operating income increase if Minneapolis increased its sales by $81,750 per year? Assume no change in cost behavior patterns.
Raner, Harris and Chan is a consulting firm specializing in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. It classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given below: Total Company Office Chicago Minneapolis Sales $ 468,000 100.00% $ 156,000 100.00% $ 312,000 100.00% Variable expenses 234,000 50.00% 46,800 30.00% 187,200 60.00% Contribution margin 234,000 50.00% 109,200 70.00% 124,800 40.00% Traceable fixed expenses 131,040 28.00% 81,120 52.00% 49,920 16.00% Office segment margin 102,960 22.00% $ 28,080 18.00% $ 74,880 24.00% Common fixed expenses not traceable to offices 65,520 14.00% Net operating income $ 37,440 8.00% Exercise 6-17 (Algo) Working with a Segmented Income Statement [LO6-4] Assume Minneapolis’s sales by major market are: Minneapolis Market…
Raner, Harris & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Office Total Company Chicago Minneapolis Sales $ 450,000 100 % $ 150,000 100 % $ 300,000 100 % Variable expenses 225,000 50 % 45,000 30 % 180,000 60 % Contribution margin 225,000 50 % 105,000 70 % 120,000 40 % Traceable fixed expenses 126,000 28 % 78,000 52 % 48,000 16 % Office segment margin 99,000 22 % $ 27,000 18 % $ 72,000 24 % Common fixed expenses not traceable to offices 63,000 14 % Net operating income $ 36,000 8 % 3. Assume that sales in Chicago increase by $50,000…
Raner, Harris & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Required: 1-a. Compute the companywide break-even point in dollar sales. 1-b. Compute the break-even point for the Chicago office and for the Minneapolis office. 1-c. Is the companywide break-even point greater than, less than, or equal to the sum of the Chicago and Minneapolis break-even points? 2. By how much would the company’s net operating income increase if Minneapolis increased its sales by $52,500 per year? Assume no change in cost behavior patterns. 3. Assume that sales in Chicago increase by $35,000 next year and that sales in Minneapolis remain unchanged. Assume no change in fixed costs. a. Prepare a new segmented…
Raner, Harris and Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Total Company Office Chicago Minneapolis Sales $ 450,000 100% $ 150,000 100% $ 300,000 100% Variable expenses 225,000 50% 45,000 30% 180,000 60% Contribution margin 225,000 50% 105,000 70% 120,000 40% Traceable fixed expenses 126,000 28% 78,000 52% 48,000 16% Office segment margin 99,000 22% $ 27,000 18% $ 72,000 24% Common fixed expenses not traceable to offices 63,000 14% Net operating income $ 36,000 8% Assume that Minneapolis’ sales by major market are: Minneapolis Market Medical Dental Sales $ 300,000 100% $ 200,000 100% $ 100,000 100% Variable expenses 180,000 60% 128,000 64% 52,000 52% Contribution margin 120,000 40% 72,000 36% 48,000…
Raner, Harris and Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Total Company Office Chicago Minneapolis Sales $ 450,000 100% $ 150,000 100% $ 300,000 100% Variable expenses 225,000 50% 45,000 30% 180,000 60% Contribution margin 225,000 50% 105,000 70% 120,000 40% Traceable fixed expenses 126,000 28% 78,000 52% 48,000 16% Office segment margin 99,000 22% $ 27,000 18% $ 72,000 24% Common fixed expenses not traceable to offices 63,000 14% Net operating income $ 36,000 8% 2. By how much would the company’s net operating income increase if Minneapolis increased its sales by $75,000 per year? Assume no change in cost behavior patterns.
Raner, Harris and Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Total Company Office Chicago Minneapolis Sales $ 450,000 100% $ 150,000 100% $ 300,000 100% Variable expenses 225,000 50% 45,000 30% 180,000 60% Contribution margin 225,000 50% 105,000 70% 120,000 40% Traceable fixed expenses 126,000 28% 78,000 52% 48,000 16% Office segment margin 99,000 22% $ 27,000 18% $ 72,000 24% Common fixed expenses not traceable to offices 63,000 14% Net operating income $ 36,000 8% 1-a. Compute the companywide break-even point in dollar sales. 1-b. Compute the break-even point for the Chicago office and for the Minneapolis office. 1-c. Is the companywide break-even point…
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