Brabant NV of the Netherlands is a wholesale distributor of Dutch cheeses that it sells throughout the European Community. Unfortunately, the company's profits have been declining, which has caused considerable concern. To help understand the condition of the company, the managing director of the company has requested that the monthly income statement be segmented by sales territory. Accordingly, the company's accounting department has prepared the following statement for March, the most recent month. (The Dutch currency is the euro which is designated by €.)
|
Sales Territory
|
|
Southern
Europe |
Middle
Europe |
Northern
Europe |
| Sales |
€ |
312,000 |
€ |
804,000 |
€ |
703,000 |
|
|
|
|
|
|
|
| Territorial expenses (traceable): |
|
|
|
|
|
|
| Cost of goods sold |
|
93,000 |
|
237,000 |
|
315,000 |
| Salaries |
|
58,000 |
|
57,000 |
|
108,000 |
| Insurance |
|
9,200 |
|
16,300 |
|
14,500 |
| Advertising |
|
109,000 |
|
240,000 |
|
245,000 |
| Depreciation |
|
21,000 |
|
33,000 |
|
25,000 |
| Shipping |
|
16,000 |
|
34,000 |
|
40,000 |
|
|
|
|
|
|
|
| Total territorial expenses |
|
306,200 |
|
617,300 |
|
747,500 |
|
|
|
|
|
|
|
Territorial income (loss)
before corporate expenses |
|
5,800 |
|
186,700 |
|
(44,500) |
|
|
|
|
|
|
|
| Corporate expenses: |
|
|
|
|
|
|
| Advertising (general) |
|
13,000 |
|
39,000 |
|
34,000 |
| General administrative |
|
19,000 |
|
19,000 |
|
19,000 |
|
|
|
|
|
|
|
| Total corporate expenses |
|
32,000 |
|
58,000 |
|
53,000 |
|
|
|
|
|
|
|
| Net operating income (loss) |
€ |
(26,200) |
€ |
128,700 |
€ |
(97,500) |
|
|
|
|
|
|
|
|
|
Cost of goods sold and shipping expenses are both variable; other costs are all fixed. Brabant NV purchases cheeses at auction and from farmers' cooperatives, and it distributes them in the three territories listed above. Each of the three sales territories has its own manager and sales staff. The cheeses vary widely in profitability; some have a high margin and some have a low margin. (Certain cheeses, after having been aged for long periods, are the most expensive and carry the highest margins.)
|
| 3. |
Prepare a new segmented contribution format income statement for May. Show a Total column as well as data for each territory. In addition, for the company as a whole and for each sales territory, show each item on the segmented income statement as a percent of sales. (Note: % columns may not total due to rounding.) (Input all amounts as positive values except losses and their percentages which should be indicated by a minus sign. Round your percentage answers to 1 decimal place. Omit the "€" and "%" signs in your response.)
|
|
Total
|
Southern Europe
|
Middle Europe
|
Northern Europe
|
|
Amount
in €s |
% |
Amount
in €s |
% |
Amount
in €s |
% |
Amount
in €s |
% |
| Sales |
€ ? |
%? |
€? |
%? |
€? |
%? |
€? |
%? |
|
|
|
|
|
|
|
|
|
| Variable expenses: |
|
|
|
|
|
|
|
|
| Cost of goods sold |
€? |
%? |
€? |
%? |
€? |
%? |
€? |
%? |
| Shipping expense |
€? |
%? |
€? |
%? |
€? |
%? |
€? |
%? |
|
|
|
|
|
|
|
|
|
| Total variable expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Contribution margin |
€? |
%? |
€? |
%? |
€? |
%? |
€? |
%? |
|
|
|
|
|
|
|
|
|
| Traceable fixed expenses: |
|
|
|
|
|
|
|
|
| Salaries |
€? |
%? |
€? |
%? |
€? |
%? |
€? |
%? |
| Insurance |
€? |
%? |
€? |
%? |
€? |
%? |
€? |
%? |
| Advertising |
€? |
%? |
€? |
%? |
€? |
%? |
€? |
%? |
| Depreciation |
€? |
%? |
€? |
%? |
€? |
%? |
€? |
%? |
|
|
|
|
|
|
|
|
|
| Total traceable fixed expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Territorial segment margin |
€? |
%? |
€? |
%? |
€? |
%? |
€? |
%? |
|
|
|
|
|
|
|
|
|
| Common fixed expenses: |
|
|
|
|
|
|
|
|
| Advertising (general) |
€? |
%? |
€? |
%? |
€? |
%? |
€? |
%? |
| General administration |
€? |
%? |
€? |
%? |
€? |
%? |
€? |
%? |
|
|
|
|
|
|
|
|
|
| Total common fixed expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net operating income (loss) |
€? |
%? |
€? |
%? |
€? |
%? |
€? |
%? |
|
|
|
|
|
|
|
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