Question

Nantua Corporation has two divisions, Southern and Northern. The following information was taken from last year's income statement segmented by division: Total Company Southern Northern Sales $4,000,000 $2,500,000 $1,500,000 Contribution margin $1,650,000 $1,050,000 $600,000 Divisional segment margin $850,000 $700,000 $150,000 Net operating income last year for Nantua Corporation was $400,000. In last year's income statement segmented by division, what were Nantua's total common fixed expenses? Group of answer choices $450,000 $800,000 $1,250,000 $1,300,000

Answer 1

Answer:

$450,000

Explanation:

the computation of the total common fixed expenses is shown below:

= Divisional segment margin  - net operating income

= $850,000 - $400,000

= $450,000

By deducting the net operating income from the divisional segment margin we can determine the total common fixed expense

And, the same is to be considered