GIGO Computers has two divisions that manufacture computing devices. Below are the results from last year. Laptop Tablet Total $ $ 14,500,000.00 $ 36,000,000.00 $ 50,500,000.00 9,500,000.00 $ 23,400,000.00 $ 32,900,000.00 1,400,000.00 $ 1,880,000.00 $3,280,000.00 3,600,000.00 $ 10,720,000.00 $ 14,320,000.00 $ Gross Profit $ Variable Operating Expenses $ 1,850,000.00 $ 5,760,000.00 $ 7,610,000.00 Fixed Operating Expenses $ 900,000.00 $ 840,000.00 $ 1,740,000.00 Common Fixed Costs $ 1,200,000.00 $ 1,300,000.00 $S 2,500,000.00 Operating Income 350,000.00 $2,820,000.00 S 2,470,000.00 Sales Revenue Variable Cost of Goods Sold Fixed Cost of Goods Sold -$ Meng Wanzhou, the President of GIGO is not happy that the laptop division is losing money. Prepare a segment margin income statement. Fixed cost of goods sold, and fixed operating expenses can be traced to each division. (6 marks) b) Should Meng keep or close the laptop division? (1 mark)

The centralized computer technology department of Hardy Company has expenses of $320,000. The department has provided a total of 4,000 hours of service for the period. The Retail Division has used 2,750 hours of computer technology service during the period, and the Commercial Division has used 1,250 hours of computer technology service. Additional data for the two divisions is following below: Retail Division Commercial Division Sales $2,150,000 $1,200,000 Cost of goods sold 1,300,000 800,000 Selling expenses 150,000 175,000 Determine the divisional income from operations for the Retail Division and the Commercial Division. Do not round interim calculations. Hardy Company Divisional Income from Operations blank Retail Division Commercial Division $- Select - $- Select - - Select - - Select - $- Select - $- Select - - Select - - Select - $- Select - $- Select - - Select - - Select - Income from operations $fill in the blank 19 $fill in the blank 20 Check My Work PreviousNext

Bed & Bath, a retailing company, has two departments-Hardware and Linens. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Fixed expenses Contribution margin Net operating income (loss) 1,307,000 Department Total $ 4,210,000 Hardware $ 3,040,000 Linens $ 1,170,000 403,000 767,000 840,000 $ (73,000) 2,903,000 2,290,000 $ 613,000 904,000 2,136,000 1,450,000 $ 686,000 A study indicates that $379,000 of the fixed expenses being charged to Linens are sunk costs or allocated costs that will continue even if the Linens Department is dropped. In addition, the elimination of the Linens Department will result in a 15% decrease in the sales of the Hardware Department. Required: What is the financial advantage (disadvantage) of discontinuing the Linens Department? Financial (disadvantage)

Robinson Products Company has two service departments (S1 and S2) and two production departments (P1 and P2). The distribution of each service department's efforts (in percentages) to the other departments is: From S1 S2 S1 S2 To P1 10% 20% ? 10% S1 S2 P1 P2 – P2 $225,000 75,000 62,000 180,000 ?% The direct operating costs of the departments (including both variable and fixed costs) are: 30 Required: 1. Determine the total cost of P1 and P2 using the direct method. 2. Determine the total cost of P1 and P2 using the step method. 3. Determine the total cost of P1 and P2 using the reciprocal method.

Wyrich Corporation has two divisions: Blue Division and Gold Division. The following report is for the most recent operating period:    Total Company Blue Division   Gold Division Sales $ 522,000 $ 391,000   $ 131,000   Variable expenses   160,670   89,930     70,740   Contribution margin   361,330   301,070     60,260   Traceable fixed expenses   286,000   239,000     47,000   Segment margin   75,330 $ 62,070   $ 13,260   Common fixed expenses   73,080             Net operating income $ 2,250              The Gold Division's break-even sales is closest to:     $102,174     $261,043     $142,043     $518,750

Oscar Clemente is the manager of Forbes Division of Pitt, Inc., a manufacturer of biotech products. Forbes Division, which has $4.18 million in assets, manufactures a special testing device. At the beginning of the current year, Forbes invested $5.05 million in automated equipment for test machine assembly. The division 's expected income statement at the beginning of the year was as follows. Sales revenue $ 16,080,000 Operating costs Variable 2,040, 000 Fixed (all cash) 7,600,000 Depreciation New equipment 1,610,000 Other 1,350,000 Division operating profit $ 3,480,000A sales representative from LSI Machine Company approached Oscar in October. LSI has for $5.85 million a new assembly machine that offers significant improvements over the equipment Oscar bought at the beginning of the year. The new equipment would expand division output by 10 percent while reducing cash fixed costs by 5 percent. It would be depreciated for accounting purposes over a three-year life. Depreciation would…

Bed & Bath, a retailing company, has two departments-Hardware and Linens. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income (loss) Total $ 4,310,000 1,313,000 2,997,000 2,200,000 $ 797,000 Department Hardware $ 3,130,000 901,000 2,229,000 1,360,000 $ 869,000 Linens $ 1,180,000 412,000 768,000 840,000 $ (72,000) A study indicates that $377,000 of the fixed expenses being charged to Linens are sunk costs or allocated costs that will continue even if the Linens Department is dropped. In addition, the elimination of the Linens Department will result in a 11% decrease in the sales of the Hardware Department. Required: What is the financial advantage (disadvantage) of discontinuing the Linens Department? Financial (disadvantage)

Indigo Chance Co. sells computers and video game systems. The business is divided into two divisions along product lines. Variable costing income statements for the current year are presented below: Computers VG Systems Total Sales $720,000 $480,000 $1,200,000 Variable costs 504,000 384,000 888,000 Contribution margin $216,000 $96,000 312,000 Fixed costs 255,060 Net income $56,940 (a) Determine the sales mix and contribution margin ratio for each division. Sales mix Computers VG Systems

The Carlsbad Corporation produces and markets two types of electronic calculators: Model 4A and Model 5A. The following data were gathered on activities during the third quarter: Sales in units Sales price per unit Variable production costs per unit Traceable fixed production costs Variable selling expenses per unit Traceable fixed selling expenses Allocated portion of corporate expenses Model 4A 5,500 $ 141 $ 30 $ 205,000 Model 5A MAN 3,250 $ 250 $ 55 $ 305,000 $ 15 $ 17 $ 12,500 $ 126,000 $ 17,500 $ 130,000 Required: Prepare a segmented income statement for last quarter. The statement should provide sufficient detail to allow the company to evaluate the performance of the manager of each product line.