The company prepared the contribution form segmented income statement as shown

# The company prepared the contribution form segmented

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Piedmont Company segments its business into two regions—North and South. The company prepared the contribution format segmented income statement as shown: Total Company North South Sales \$ 750,000 \$ 600,000 \$ 150,000 Variable expenses 510,000 480,000 30,000 Contribution margin 240,000 120,000 120,000 Traceable fixed expenses 128,000 64,000 64,000 Segment margin 112,000 \$ 56,000 \$ 56,000 Common fixed expenses 54,000 Net operating income \$ 58,000 Required: 1. Compute the companywide break-even point in dollar sales. 2. Compute the break-even point in dollar sales for the North region. 3. Compute the break-even point in dollar sales for the South region. (For all requirements, round your intermediate calculations to 2 decimal places. Round your final answers to the nearest dollar.) rev: 02_08_2018_QC_CS-117419
3/30/2020 Assignment Print View ; 3/3 Explanation: 1. The companywide break-even point is computed as follows: Dollar sales for company to break even = Traceable fixed expenses + Common fixed expenses Overall CM ratio = \$128,000 + \$54,000 \$240,000 ÷ \$750,000 = \$182,000 0.32 = \$568,750 2. The break-even point for the North region is computed as follows: Dollar sales for a segment to break even = Segment traceable fixed expenses Segment CM ratio = \$64,000 \$120,000 ÷ \$600,000 = \$64,000 0.20 = \$320,000 3. The break-even point for the South region is computed as follows: Dollar sales for a segment to break even = Segment traceable fixed expenses Segment CM ratio = \$64,000 \$120,000 ÷ \$150,000 = \$64,000 0.80 = \$80,000

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• Fall '17
• Justin Miller
• Revenue, Net Income, Southern United States, Dollar Sales, companywide break

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