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Unformatted text preview: MS's strategy is use an internet site at a fixed cost of $250,000, plus $0.10 per click. The click rate is 50 times the number of units sold. Of the above costs, the product manager's salary is considered to be an uncontrollable fixed cost for each unit. The only other costs are general and administrative costs incurred at the corporate level. These costs of $275,000 are not traced to any particular product. (a) Prepare a contribution income statement for each segment, revealing the segment margin. (b) Prepare a "company total" contribution income statement for all three segments. (c) Evaluate Flash in a Flash's results, and comment as to why corporate management should look at segmented results in addition to overall corporate performance....
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- Spring '11