Answer:
Lazarus Corporation
A properly constructed segmented income statement in a contribution format would show that the net operating income of the company as a whole is:
= $47,000.
Explanation:
a) Data and Calculations:
North South Total
Sales revenues $380,000 $230,000 $610,000
Variable expenses 213,000 104,000 317,000
Contribution $167,000 $126,000 $293,000
Fixed expenses:
Traceable 65,000 25,000 90,000
Common 84,000 72,000 156,000
Total $149,000 $97,000 $246,000
Operating income $18,000 $29,000 $47,000
b) Segmented income statement is prepared to show the contributions and operating income generated from different segments of the entity. It helps to evaluate performances of segments and to identify profitable or less profitable segments.
