Raner, Harris and Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company's most recent year is given: Total Company Office Chicago Minneapolis Sales $ 468,000 100% $ 156, 000 100 % $ 312,000 100% Variable expenses 234,000 50 % 46,800 30% 187, 200 60% Contribution margin 234, 000 50 % 109, 200 70 % 124,800 40% Traceable fixed expenses 131,040 28% 81, 120 52% 49,920 16 % Office segment margin 102,960 22% $ 28,080 18% $ 74,880 24% Common fixed expenses not traceable to offices 65,520 14% Net operating income $ 37,440 8% 2. By how much would the company's net operating income increase if Minneapolis increased its sales by $78,000 per year? Assume no change in cost behavior patterns.

Raner, Harris and Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company's most recent year is given: Total Company Office Chicago Minneapolis Sales $ 468,000 100% $ 156, 000 100 % $ 312,000 100% Variable expenses 234,000 50 % 46,800 30% 187, 200 60% Contribution margin 234, 000 50 % 109, 200 70 % 124,800 40% Traceable fixed expenses 131,040 28% 81, 120 52% 49,920 16 % Office segment margin 102,960 22% $ 28,080 18% $ 74,880 24% Common fixed expenses not traceable to offices 65,520 14% Net operating income $ 37,440 8% 2. By how much would the company's net operating income increase if Minneapolis increased its sales by $78,000 per year? Assume no change in cost behavior patterns.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 4EB: Roper Furniture manufactures office furniture and tracks cost data across their process. The...

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Raner, Harris and Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company's most recent year is given: Total Company Office Chicago Minneapolis Sales $ 526, 500 100.00% $ 175,500 100.00% $ 351,000 100.00% Variable expenses 263, 250 50.00% 52, 650 30.00 % 210, 600 60.00% Contribution margin 263, 250 50.00 % 122,850 70.00% 140, 400 40.00% Traceable fixed expenses 147,420 28.00% 91,260 52.00 % 56, 160 16.00% Office segment margin 115,830 22.00% $ 31,590 18.00% $ 84, 240 24.00% Common fixed expenses not traceable to offices 73,710 14.00% Net operating income $ 42,120 8.00% 3. Assume that sales in Chicago increase by $58, 500 next year and that sales in Minneapolis remain unchanged. Assume no change in fixed costs. a. Prepare a new segmented income…
Raner, Harris & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Total Company Office Chicago Minneapolis Sales $ 508,500 100.00% $ 169,500 100.00% $ 339,000 100.00% Variable expenses 254,250 50.00% 50,850 30.00% 203,400 60.00% Contribution margin 254,250 50.00% 118,650 70.00% 135,600 40.00% Traceable fixed expenses 142,380 28.00% 88,140 52.00% 54,240 16.00% Office segment margin 111,870 22.00% $ 30,510 18.00% $ 81,360 24.00% Common fixed expenses not traceable to offices 71,190 14.00% Net operating income $ 40,680 8.00% rev: 06_09_2020_QC_CS-215744, 09_15_2020_QC_CS-220558, 11_04_2020_QC_CS-238526, 03_30_2021_QC_CS-258090 Exercise 6-17 (Algo) Working with…
Raner, Harris & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company's most recent year is given: Office Total Company $ 513,000 256, 500 Minneapolis $ 342,000 205,200 136,800 54, 720 Chicago $ 171,000 100.00% 100.00% 100.00% Sales 30.00% 60.00% 51,300 119, 700 88,920 $ 30,780 50.00% Variable expenses Contribution margin Traceable fixed expenses 70.00% 52.00% 40.00% 16.00% 50.00% 256,500 143,640 28.00% 18.00% $ 82,080 24.00% 112,860 22.00% Office segment margin Common fixed expenses not traceable to offices 71,820 14.00% $ 41,040 8.00% Net operating income 3. Assume that sales in Chicago increase by $57,000 next year and that sales in Minneapolis remain unchanged. Assume no change in fixed costs. a. Prepare a new segmented income statement…
Raner, Harris and Chan is a consulting firm specializing in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. It classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given below: Total Company Office Chicago Minneapolis Sales $ 490,500 100.00% $ 163,500 100.00% $ 327,000 100.00% Variable expenses 245,250 50.00% 49,050 30.00% 196,200 60.00% Contribution margin 245,250 50.00% 114,450 70.00% 130,800 40.00% Traceable fixed expenses 137,340 28.00% 85,020 52.00% 52,320 16.00% Office segment margin 107,910 22.00% $ 29,430 18.00% $ 78,480 24.00% Common fixed expenses not traceable to offices 68,670 14.00% Net operating income $ 39,240 8.00% 2. How much would the company’s net operating income increase if Minneapolis increased its sales by $81,750 per year? Assume no change in cost behavior patterns.
Raner, Harris & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Office Total Company Chicago Minneapolis Sales $ 450,000 100 % $ 150,000 100 % $ 300,000 100 % Variable expenses 225,000 50 % 45,000 30 % 180,000 60 % Contribution margin 225,000 50 % 105,000 70 % 120,000 40 % Traceable fixed expenses 126,000 28 % 78,000 52 % 48,000 16 % Office segment margin 99,000 22 % $ 27,000 18 % $ 72,000 24 % Common fixed expenses not traceable to offices 63,000 14 % Net operating income $ 36,000 8 % 3. Assume that sales in Chicago increase by $50,000…
Raner, Harris and Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Total Company Office Chicago Minneapolis Sales $ 450,000 100% $ 150,000 100% $ 300,000 100% Variable expenses 225,000 50% 45,000 30% 180,000 60% Contribution margin 225,000 50% 105,000 70% 120,000 40% Traceable fixed expenses 126,000 28% 78,000 52% 48,000 16% Office segment margin 99,000 22% $ 27,000 18% $ 72,000 24% Common fixed expenses not traceable to offices 63,000 14% Net operating income $ 36,000 8% 2. By how much would the company’s net operating income increase if Minneapolis increased its sales by $75,000 per year? Assume no change in cost behavior patterns.
Raner, Harris and Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Total Company Office Chicago Minneapolis Sales $ 450,000 100% $ 150,000 100% $ 300,000 100% Variable expenses 225,000 50% 45,000 30% 180,000 60% Contribution margin 225,000 50% 105,000 70% 120,000 40% Traceable fixed expenses 126,000 28% 78,000 52% 48,000 16% Office segment margin 99,000 22% $ 27,000 18% $ 72,000 24% Common fixed expenses not traceable to offices 63,000 14% Net operating income $ 36,000 8% 1-a. Compute the companywide break-even point in dollar sales. 1-b. Compute the break-even point for the Chicago office and for the Minneapolis office. 1-c. Is the companywide break-even point…
Raner, Harris and Chan is a consulting firm specializing in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. It classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given below: Total Company Office Chicago Minneapolis Sales $ 468,000 100.00% $ 156,000 100.00% $ 312,000 100.00% Variable expenses 234,000 50.00% 46,800 30.00% 187,200 60.00% Contribution margin 234,000 50.00% 109,200 70.00% 124,800 40.00% Traceable fixed expenses 131,040 28.00% 81,120 52.00% 49,920 16.00% Office segment margin 102,960 22.00% $ 28,080 18.00% $ 74,880 24.00% Common fixed expenses not traceable to offices 65,520 14.00% Net operating income $ 37,440 8.00% Exercise 6-17 (Algo) Working with a Segmented Income Statement [LO6-4] Assume Minneapolis’s sales by major market are: Minneapolis Market…
Raner, Harris & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Assume that Minneapolis’ sales by major market are: Market Minneapolis Medical Dental Sales $ 570,000 100 % $ 380,000 100 % $ 190,000 100 % Variable expenses 342,000 60 % 247,000 65 % 95,000 50 % Contribution margin 228,000 40 % 133,000 35 % 95,000 50 % Traceable fixed expenses 68,400 12 % 19,000 5 % 49,400 26 % Market segment margin 159,600 28 % $ 114,000 30 % $ 45,600 24 % Common fixed expensesnot traceable to markets 17,100 3 % Office segment margin $ 142,500 25 % The company would like to initiate an intensive advertising campaign in one of…
Raner, Harris and Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given: Total Company Office Chicago Minneapolis Sales $ 450,000 100% $ 150,000 100% $ 300,000 100% Variable expenses 225,000 50% 45,000 30% 180,000 60% Contribution margin 225,000 50% 105,000 70% 120,000 40% Traceable fixed expenses 126,000 28% 78,000 52% 48,000 16% Office segment margin 99,000 22% $ 27,000 18% $ 72,000 24% Common fixed expenses not traceable to offices 63,000 14% Net operating income $ 36,000 8% Assume that Minneapolis’ sales by major market are: Minneapolis Market Medical Dental Sales $ 300,000 100% $ 200,000 100% $ 100,000 100% Variable expenses 180,000 60% 128,000 64% 52,000 52% Contribution margin 120,000 40% 72,000 36% 48,000…
Raner, Harris and Chan is a consulting firm that specializes in Information systems for medical and dental clinics. The firm has two offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented Income statement for the company's most recent year is given: Office Chicago Sales Variable expenses Contribution margin Total Company $ 495,000 100% 247,5ee 58% 247,500 sex 138,600 28% 108,900 22% 69,300 14% $39,600 $ 165,000 100% 49,500 30% 115,500 70% 85,800 52% $ 29,700 18% Minneapolis $ 330,000 100% 198,000 60% 132,000 48% 52,800 16% 24% Traceable fixed expenses $ 79,200 Office segment margin Common fixed expenses not traceable to offices Net operating income 8% 3. Assume that sales in Chicago Increase by $55,000 next year and that sales in Minneapolis remain unchanged. Assume no change In fixed costs. a. Prepare a new segmented Income statement for the company. (Round your Intermediate calculations…