Colasuonno Corporation has two divisions: the West Division and the East Divisio
ID: 2502977 • Letter: C
Question
Colasuonno Corporation has two divisions: the West Division and the East Division. The corporation's net operating income is $85,400. The West Division's divisional segment margin is $48,500 and the East Division's divisional segment margin is $174,400. What is the amount of the common fixed expense not traceable to the individual divisions?
Colasuonno Corporation has two divisions: the West Division and the East Division. The corporation's net operating income is $85,400. The West Division's divisional segment margin is $48,500 and the East Division's divisional segment margin is $174,400. What is the amount of the common fixed expense not traceable to the individual divisions?
Explanation / Answer
Net Operating Income = Contribution Margin - Fixed Costs
Net Operating Income = (48,500 + 174,400) - Fixed Costs
85,400 = 222,900 - Fixed costs
Fixed costs = $ 137,500
ans is C) $ 137,500