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ACC12 - 12-1 Sales Variable Expenses Contribution Margin...

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12-1 Total Company Weedban Greengrow Sales $300,000 $90,000 $210,000 Variable Expenses $183,000 $36,000 $147,000 Contribution Margin $117,000 $54,000 $63,000 Traceable fixed expenses per year $66,000 $45,000 $21,000 Segment Margin $51,000 $9,000 $42,000 Common Fixed Expenses $33,000 Net Operating Income $18,000 12-2 1. Margin = $600,000/$7,500,000 = .08 2. Turnover = $7,500,000/$5,000,000 = 1.5 3. ROI = .08*1.5 = .12 12-3 Residual income = 600,000 – (2,800,000 * .18) Residual income = 600,000 – 504,000 Residual income = 96,000 12-5 1. Osaka Yokohama 210,000/3,000,000 = .07 720,000/9,000,000 = .08 3,000,000/1,000,000 = 3 9,000,000/4,000,000 = 2.25 Roi = .07*3 = .21 Roi = .08*2.25 .18 2. Osaka Yokohama RI = 210,000 – (1,000,000 *.15) = 60,000 RI = 720,000 – (4,000,000 *.15) = 120,000 4. No because its sales are much larger for Yokohama indicating that it is a much larger division and not better managed. 12-13 1. NOI increase = 40% * $75,000 = $30,000 2. A. Total Company Office Chicago Minneapolis Sales $500,000 100% $200,000 100% $300,000 100 % Variable Expenses $240,000 48% $60,000 30% $180,000 60% Contribution Margin $260,000 52% $140,000 70% $120,000
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