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# Question 18: (1 point) O'Neill, Incorporated's income statement for the most recent month is given below.

Question 18: (1 point)
O'Neill, Incorporated's income statement for the most recent month is given below.
Total Store A Store B
Sales   \$540,000 \$160,000 \$380,000
Variable expenses   352,800 94,400 258,400
Contribution margin   187,200 65,600 121,600
Traceable fixed expenses     75,000    20,000    55,000
Segment margin   112,200 \$ 45,600 \$ 66,600
Common fixed expenses      27,000
Net operating income   \$ 85,200
The marketing department believes that a promotional campaign at Store A costing \$3,000 will increase sales by \$16,000. If its plan is adopted, overall company net operating income should:
increase by \$3,560
increase by \$3,710
decrease by \$3,835
decrease by \$3,770

Question 18: (1 point)
O'Neill, Incorporated's income statement for the most recent month is
given below.
Â
Total
Store A
Store B
SalesÂ Â Â
\$540,000
\$160,000
\$380,000
Variable expensesÂ Â Â
352,800
94,400
258,400
Contribution marginÂ Â Â
187,200
65,600
121,600
Traceable fixed expensesÂ Â Â
Â Â 75,000
Â Â Â 20,000
Â Â Â 55,000
Segment marginÂ Â Â
112,200
\$ 45,600
\$ 66,600
Common fixed expensesÂ Â Â
Â Â Â 27,000
Â
Â
Net operating incomeÂ Â Â
\$ 85,200
Â
Â
The marketing department believes that a promotional campaign at Store A
costing \$3,000 will increase sales by \$16,000. If its plan is adopted,
overall company net operating income should:
increase by \$3,560
increase by \$3,710
decrease by \$3,835
decrease by \$3,770

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