Question

Farrar Corporation has two major business segments-Consumer and Commercial. Data for the segment and for the company for March appear below: In addition, common fixed expenses totaled $210,000 and were allocated as follows: $122,000 to the Consumer business segment and $88,000 to the Commercial business segment. A properly constructed segmented income statement in a contribution format would show that the segment margin of the Consumer business segment is: Select one: a. $164,000 b. $62,000 c. $394,000 d. $184,000

Answer 1

Answer:

d. $184,000

Explanation:

Some information is missing, so I looked for similar questions:

Sales revenues, Consumer $ 680,000

Sales revenues, Commercial $ 280,000

Variable expenses, Consumer $ 394,000

Variable expenses, Commercial $ 143,000

Traceable fixed expenses, Consumer $ 102,000

Traceable fixed expenses, Commercial $ 45,000

                                       Consumer         Commercial           Total

Revenue                         $680,000         $280,000            $960,000

Variable expenses        ($394,000)        ($143,000)          ($537,000)

Contribution margin      $286,000           $137,000            $423,000

Traceable fixed exp.     ($102,000)          ($45,000)           ($147,000)

Segment margin             $184,000            $92,000           $276,000

Common fixed exp.                                                             ($210,000)

Operating income                                                                  $66,000