Exercise 6-11 (Algo) Segmented Income Statement [LO6-4] Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses as shown by its most recent monthly contribution format income statement: Sales Variable expenses. Contribution margin Fixed expenses Net operating income (loss) In an effort to resolve the problem, the company wants to prepare an income statement segmented by division. Accordingly, the Accounting Department provided the following information: Sales Variable expenses as a percentage of sales Traceable fixed expenses. $ 1,601,000 649,870 951,130 1,046,000 $ (94,870) Req 11 Req 2A East $ 391,000 $ 269,000 Req 28 47% Complete this question by entering your answers in the tabs below. Division Central $630,000 Required: 1. Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department believes increasing the West Division's monthly advertising by $29,000 will increase that division's sales by 12%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease) if the proposal is implemented? 2-b. Would you recommend the increased advertising? 39% $ 326,000 < Prev West $ 580,000 38% $ 206,000 The Marketing Department believes increasing the West Division's monthly advertising by $29,000 will increase that division's sales by 12%. Assuming these estimates are accurate, how much would the company's net operating income increase. (decrease) if the proposal is implemented? Note: Do not round intermediate calculations. 4 of 4 Next
Exercise 6-11 (Algo) Segmented Income Statement [LO6-4] Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses as shown by its most recent monthly contribution format income statement: Sales Variable expenses. Contribution margin Fixed expenses Net operating income (loss) In an effort to resolve the problem, the company wants to prepare an income statement segmented by division. Accordingly, the Accounting Department provided the following information: Sales Variable expenses as a percentage of sales Traceable fixed expenses. $ 1,601,000 649,870 951,130 1,046,000 $ (94,870) Req 11 Req 2A East $ 391,000 $ 269,000 Req 28 47% Complete this question by entering your answers in the tabs below. Division Central $630,000 Required: 1. Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department believes increasing the West Division's monthly advertising by $29,000 will increase that division's sales by 12%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease) if the proposal is implemented? 2-b. Would you recommend the increased advertising? 39% $ 326,000 < Prev West $ 580,000 38% $ 206,000 The Marketing Department believes increasing the West Division's monthly advertising by $29,000 will increase that division's sales by 12%. Assuming these estimates are accurate, how much would the company's net operating income increase. (decrease) if the proposal is implemented? Note: Do not round intermediate calculations. 4 of 4 Next
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![Exercise 6-11 (Algo) Segmented Income Statement [LO6-4]
Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses as shown by its most recent monthly
contribution format income statement:
Sales
Variable expenses
Contribution margin
Fixed expenses
Net operating income (loss)
In an effort to resolve the problem, the company wants to prepare an income statement segmented by division. Accordingly, the
Accounting Department provided the following information:
Sales
Variable expenses as a percentage of sales
Traceable fixed expenses
$ 1,601,000
649,870
951,130
1,046,000
$ (94,870)
East
$ 391,000
47%
$ 269,000
Req 1
Complete this question by entering your answers in the tabs below.
Req 2A
Division
Central
$630,000
39%
$ 326,000
Required:
1. Prepare a contribution format income statement segmented by divisions.
2-a. The Marketing Department believes increasing the West Division's monthly advertising by $29,000 will increase that division's
sales by 12%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease) if the
proposal is implemented?
2-b. Would you recommend the increased advertising?
Reg 28
The Marketing Department believes increasing the West Division's monthly advertising by $29,000 will increase that division's
sales by 12%. Assuming these estimates are accurate, how much would the company's net operating income increase
(decrease) if the proposal is implemented?
Note: Do not round intermediate calculations.
< Prev
West
$ 580,000
$ 206,000
4 of 4
38%
Next](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6ac54068-09d0-4df4-866a-66121ad2e10c%2Fe4ae56dc-60f4-426e-8963-23d1124221d6%2Fohglamj_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Exercise 6-11 (Algo) Segmented Income Statement [LO6-4]
Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses as shown by its most recent monthly
contribution format income statement:
Sales
Variable expenses
Contribution margin
Fixed expenses
Net operating income (loss)
In an effort to resolve the problem, the company wants to prepare an income statement segmented by division. Accordingly, the
Accounting Department provided the following information:
Sales
Variable expenses as a percentage of sales
Traceable fixed expenses
$ 1,601,000
649,870
951,130
1,046,000
$ (94,870)
East
$ 391,000
47%
$ 269,000
Req 1
Complete this question by entering your answers in the tabs below.
Req 2A
Division
Central
$630,000
39%
$ 326,000
Required:
1. Prepare a contribution format income statement segmented by divisions.
2-a. The Marketing Department believes increasing the West Division's monthly advertising by $29,000 will increase that division's
sales by 12%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease) if the
proposal is implemented?
2-b. Would you recommend the increased advertising?
Reg 28
The Marketing Department believes increasing the West Division's monthly advertising by $29,000 will increase that division's
sales by 12%. Assuming these estimates are accurate, how much would the company's net operating income increase
(decrease) if the proposal is implemented?
Note: Do not round intermediate calculations.
< Prev
West
$ 580,000
$ 206,000
4 of 4
38%
Next
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