Exam 4 REVIEW - Exam 4 Study Suggestions How do you...

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Exam 4 Study Suggestions How do you calculate ROI? Company has two divisions and net operating income is $18,500. Division A’s divisional segment margin is $27,700 and Division B’s divisional segment margin is $49,400. What is the amount of the common fixed expense not traceable to the individual divisions? Is there a disadvantage to using residual income to measure performance? If so, what is it? Know the three types of business segments: cost, revenue, and Investment, and what they are responsible for. Be able to calculate residual income. A company has two segments. Given Sales Revenue for both segments, Variable Expenses for both segments, Traceable Fixed Expenses for both segments, Common fixed expenses. (Remember: DO NOT include allocate COMMON fixed expenses to a segment’s contribution margin!!!) Calculate Contribution margin for one or both segments Operating income of company as a whole Segment margin for one or both segments === Sunk costs are ALWAYS irrelevant in decision making. Be able to identify which costs are irrelevant in different scenarios, such as a make or
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Exam 4 REVIEW - Exam 4 Study Suggestions How do you...

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