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

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
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.
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern