Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Accounting Basics Expert

Q1) Marple Associates is consulting firm which specializes in information systems for construction and landscaping companies. Firm has two offices-one in Houston and one in Dallas. Firm categorizes direct costs of consulting jobs as variable costs. Segmented for company's most recent year is listed below:

    Office
  Total Company Houston Dallas
Sales..... $750,000 100.0% $150,000 100% $600,000 100%
Variable expenses... 405,000 54.0 45,000 30 360,000 60
Contribution margin.... 345,000 46.0 105,000 70 240,000 40
Traceable fixed expenses.... 168,000 22.4 78,000 52 90,000 15
Office segment margin.... 177,000 23.6 $27,000 18% $150,000 25%
Common fixed expenses not traceable to offices.... 120,000 16.0        
Net operating income.... $57,000 7.6%        

problem:

1. By how much would company's net operating income increase if Dallas increased its sales by $75,000 per year? Suppose no change in cost behavior patterns.

2. Refer to original data. Suppose that sales in Houston increase by $50,000 next year and that sale in Dallas remain unchanged. Suppose no change in fixed costs.

a. Create a new segmented income statement for company using the above format. Illustrate both amounts and percentages.

b. Observer form income statement you have created that Cm ratio for Houston has remained unchanged at 70% (same as in the above data) but that segment margin raio has changed. How do you describe change in  segment margin ratio?

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M919733

Have any Question? 


Related Questions in Accounting Basics

Almas recording studio rents studio time to musicians in

Alma's Recording Studio rents studio time to musicians in 2-hour blocks. Each session includes the use of the studio facilities, a digital recording of the performance, and a professional music producer/mixer. Anticipate ...

Watch accounting witts video titled cash and accrual -

Watch Accounting WITT's video titled "Cash and Accrual - Conceptual": https://www.youtube.com/watch?v=aPwdgUDXkkE&feature=youtu.be Based on the video, explain two (2) advantages and two (2) disadvantages in using both th ...

Problem 3-2 lo 2 simple equity method adjustments

Problem 3-2 (LO 2) Simple equity method adjustments, consolidated worksheet. On January 1, 2015, Paro Company purchases 80% of the common stock of Solar Company for $320,000. Solar has common stock, other paid-in capital ...

Governmental accounting1 which of the following statements

GOVERNMENTAL ACCOUNTING 1. Which of the following statements is true about U.S. taxation of foreign subsidiaries? A)The U.S. does not tax income generated on subsidiaries incorporated in foreign countries. B)U.S. multina ...

Palmona co establishes a 220 petty cash fund on january 1

Palmona Co. establishes a $220 petty cash fund on January 1. On January 8, the fund shows $125 in cash along with receipts for the following expenditures: postage, $41; transportation-in, $11; delivery expenses, $13; and ...

Accountingimagine that you are a consultant working on a

Accounting Imagine that you are a consultant working on a special project to help a company determine techniques that it can use in order to calculate the fair value of investments. From the e-activity, prepare a report ...

Course project portfolio of international accounting

Course Project: Portfolio of International Accounting Findings Throughout your course work, you explored topics such as cost and revaluation models of accounting, revenue recognition, assets and liabilities, translation ...

Project assignmentdo investors react to stock

Project Assignment Do Investors React to Stock Dividends? Financial accounting theory predicts that there should be no market reaction to a company's stock dividend. This is because the market value of the shares should ...

Part 1true false questionsselect the correct answer1 a

Part 1: True / False Questions Select the correct answer 1. A single plant-wide overhead rate generally provides more accurate product costs than multiple departmental overhead rates. True False 2. The use of a predeterm ...

International accounting1 tax jurisdiction and double

INTERNATIONAL ACCOUNTING 1. Tax Jurisdiction and Double Taxation Basis for taxation come from three common bases for taxation...they are source, citizenship, and residence. (Fill in the blanks below) a. The citizenship b ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen