Piedmont Company segments its business into two regions-North and South. The com
ID: 2569377 • Letter: P
Question
Piedmont Company segments its business into two regions-North and South. The company prepared the contribution format segmented income statement as shown Total North Company $750, 000 450, 000 300, 000 138, 000 162, 000 60, 000 $102, 000 South Sales Variable expenses Contribution margin Traceable fixed expenses Segment margin Common fixed expenses Net operating income $500, 000 350, 000 150, 000 69, 000 $81, 000 $250, 000 100, 000 150, 000 69, 000 $81, 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.) 1. Dollar sales for company to break-even 2. Dollar sales for North segment to break-even 3. Dollar sales for South segment to break-evenExplanation / Answer
Total North South Contribution margin ratio 40% 30% 60% Break even point = Fixed expenses/Contribution margin ratio 1 Dollar sales for company to break even = 198000/40%= 495000 2 Dollar sales for north segment to break even = 69000/30%= 230000 3 Dollar sales for south segment to break even = 69000/60%= 115000