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Monday, 8 September 2014

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

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 below:

Office
Total Company Chicago Minneapolis
  Sales $600,000 100%   $120,000 100%   $480,000 100%  
  Variable expenses
324,000
54%  
36,000
30%  
288,000
60%  
  Contribution margin 276,000 46%   84,000 70%   192,000 40%  
  Traceable fixed expenses
134,400
22%  
62,400
52%  
72,000
15%  
  Office segment margin 141,600 24%  
$21,600
18%  
$120,000
25%  
  Common fixed expenses not
      traceable to offices
96,000 16%  
  Net operating income
$45,600
8%  


Refer to the original data. Assume that sales in Chicago increase by $40,000 next year and that sales in Minneapolis remain unchanged. Assume no change in fixed costs. Prepare a new segmented income statement for the company. (Round your percentage amounts to 2 decimal places. Input all amounts as positive value. Omit the "$" and "%" signs in your response.)

Segments
Total Company Chicago Minneapolis
Amount % Amount % Amount %
  Sales $     $     $    
  Variable expenses
 
 
 
 
 
 
  Contribution margin            
  Traceable fixed expenses
 
 
 
 
 
 
  Office segment margin    
$  
 
$  
 
  Common fixed expenses
     not traceable to segments
   
  Net operating income
$