Question 4 - Pevy Corporation has two divisions Southern...

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Unformatted text preview: Pevy Corporation has two divisions: Southern Division and Northern Division. The following data are for the most recent operating period: Total Southern Northern Company Division Division Sales $332,000 $200,000 $132,000 Variable expenses $92,400 $66,000 $26,400 Traceable f'xe‘j $170,000 $101,000 $69,000 expenses C°mm°n f'xed $36,520 $22,000 $14,520 expense The common fixed expenses have been allocated to the divisions on the basis of sales. The Northern Division‘s break—even sales is closest to: 0 $104,400 0 $131,900 —) 0 $86,250 6 . $286,163 Segment contribution margin = Segment sales — Segment variable expenses = $132,000 — $26,400 = $105,600 Segment CM ratio = Segment contribution margin + Segment sales = $105,600 + $132,000 = 0.800 Dollar sales for a segment to break even = Traceable fixed expenses + Segment CM ratio = $69,000 + 0,800 = $86,250 ...
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  • Spring '18
  • Daniel Gibbons
  • Managerial Accounting, Southern Division, Northern Division, Segment CM ratio, Division Division, Segment contribution margin, Chapter Six Multiple Choice

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