Millard Corporation is a wholesale distributor of office products. It purchases office products from manufacturers and distributes them in the West, Central, and East regions. Each of these regions is about the same size and each has its own manager and sales staff. The company has been experiencing losses for many months. In an effort to improve performance, management has requested that the monthly income statement be segmented by sales region. The company's first effort at preparing a segmented income statement for May is given below. Sales Regional expenses (traceable): Cost of goods sold Advertising Salaries Utilities Depreciation Shipping expense Total regional expenses Regional income (loss) before corporate expenses Corporate expenses: Advertising (general) General administrative expense West $ 312,000 94,000 100,000 56,000 8,600 25,000 16,000 299,600 12,400 13,000 20,000 33,000 $ (20,600) Sales Region Central $ 796,000 237,000 235,000 53,000 16,300 28,000 25,000 594,300 201,700 East $ 701,000 316,000 238,000 107,000 14, 200 30,000 40,000 745,200 (44,200) 39,000 20,000 59,000 $ 142,700 $ (102,200) 38,000 20,000 58,000 Total corporate expenses Net operating income (loss) The cost of goods sold and shipping expense are both variable. All other costs are fixed. Required: 3. Prepare a new contribution format segmented income statement for May. (Round percentage answers to 1 decimal place.)
Millard Corporation is a wholesale distributor of office products. It purchases office products from manufacturers and distributes them in the West, Central, and East regions. Each of these regions is about the same size and each has its own manager and sales staff. The company has been experiencing losses for many months. In an effort to improve performance, management has requested that the monthly income statement be segmented by sales region. The company's first effort at preparing a segmented income statement for May is given below. Sales Regional expenses (traceable): Cost of goods sold Advertising Salaries Utilities Depreciation Shipping expense Total regional expenses Regional income (loss) before corporate expenses Corporate expenses: Advertising (general) General administrative expense West $ 312,000 94,000 100,000 56,000 8,600 25,000 16,000 299,600 12,400 13,000 20,000 33,000 $ (20,600) Sales Region Central $ 796,000 237,000 235,000 53,000 16,300 28,000 25,000 594,300 201,700 East $ 701,000 316,000 238,000 107,000 14, 200 30,000 40,000 745,200 (44,200) 39,000 20,000 59,000 $ 142,700 $ (102,200) 38,000 20,000 58,000 Total corporate expenses Net operating income (loss) The cost of goods sold and shipping expense are both variable. All other costs are fixed. Required: 3. Prepare a new contribution format segmented income statement for May. (Round percentage answers to 1 decimal place.)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter13: The Balanced Scorecard: Strategic-based Control
Section: Chapter Questions
Problem 27P: At the beginning of the last quarter of 20x1, Youngston, Inc., a consumer products firm, hired Maria...
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