Please show your work in the answers. Music Teachers, Inc., is an educational as
ID: 2601498 • Letter: P
Question
Please show your work in the answers. Music Teachers, Inc., is an educational association for music teachers that has 19,800 members. The association operates from a central headquarters but has local membership chapters throughout the United States. Monthly meetings are held by the ocal chapters to discuss recent developments on topics of interest to music teachers. The association's journal, Teachers Forum, is issued monthly with features about recent developments in the field. The association publishes books and reports and also sponsors professional courses that qualify for continuing professional education credit. The association's statement of revenues and expenses for the current year is presented below Music Teachers, Inc. Statement of Revenues and Expenses For the Year Ended November 30 The board of directors of Music Teachers, Inc., has requested that a segmented income statement be prepared showing the contribution of each segment to the association. The association has four segments: Membership Division, Magazine Subscriptions Division, Books and Reports Division, and Continuing Education Division. Mike Doyle has been assigned responsibility for preparing the segmented income statement, and he has gathered the following data prior to its preparation Membership dues are $100 per year, of which $20 is considered to cover a one-year subscription to the association's jounal Other benefits include membership in the association and chapter affiliation. The portion of the dues covering the magazine subscription ($20) should be assigned to the Magazine Subscription Division. bOne-year subscriptions to Teachers Forum were sold to nonmembers and libraries at $32 per subscription. A total of 3,300 of these subscriptions were sold last year. In addition to subscriptions, the magazine generated $105,000 in advertising revenues. The costs per magazine subscription were $9 for printing and paper and $4 for postage and shipping. A total of 28,400 technical reports and professional texts were sold by the Books and Reports Division at an average unit selling price of $25. Average costs per publication were $4 for printing and paper and $2 for postage and shipping. The association offers a variety of continuing education courses to both members and nonmembers. The one-day courses had a tuition cost of $75 each and were attended by 2,500 students. A total of 1,800 students took two-day courses at a tuition cost of $125 for each student. Outside instructors were paid to teach Salary costs and space occupied by division folowExplanation / Answer
Music Teachers Inc. Segmented Income Statement Division Details Association Membership Magazine Books & Continuing Total subscriptions Reports Education Sales: Membership dues 1980000 1584000 396000 Non - member journal subscriptions 105600 105600 Reports and texts 710000 710000 Continuing education 412500 412500 Advertising 105000 105000 Total Revenues 3313100 1584000 606600 710000 412500 Expenses traceable to segments: Salaries 873000 226000 157000 302000 188000 Personnel costs (25% of salaries) 218250 56500 39250 75500 47000 Occupancy costs 217800 70200 23400 77400 46800 Printing paper 354000 207900 113600 32500 Postage and shipping 149200 92400 56800 Instructors fee 78000 78000 Reimbursement of mebmer costs 510000 510000 Other membershipservices 510000 510000 Total traceable expenses 2910250 1372700 519950 625300 392300 Segementwise excess of revenues over expenses 402850 211300 86650 84700 20200 Common expenses not traceable to dividions Salaries 95000 Personnel costs (25% of salaries) 23750 Occupancy costs 70200 Postage and shipping 50800 General andadministrative expenses 31000 Total common expenses 270750 Total excess of revenues over expenses 132100 Workings: Revenues: Membership 19800 Membership dues per year 100 Share of Magazine subscription from this 20 Membership fee only 80 Total membership fee received 1584000 Total magazine subscription from mebmers 396000 Non member subscription for magazine 3300 Non member subscripition fee 32 Total non member subscription for magazine 105600 Total subscription for magazine 501600 Number of technical reports and professional texts sold 28400 Sale price per report/ text 25 Total revenue from technical reports and texts 710000 Continuing education One-day course fee 75 Number of students that attended one-day course 2500 One-day course fee collected 187500 Two-day course fee 125 Number of students that attended two-day course 1800 Two-day course fee collected 225000 Total revenue of continuing education segment 412500 Occupancy costs Total Membership Magazine Books & Continuing Corporate subscriptions Reports Education Staff Space occupied 10000 3000 1000 1000 2000 3000 Occupancy Costs 288000 Rent of warehouse for books and reports div. 54000 54000 To be allocated based on the space occupied 234000 70200 23400 23400 46800 70200 total occupancy costs 70200 23400 77400 46800 70200 Printing and paper costs 354000 Teacher's forum subscription 23100 Cost of printing per magazine 9 Total costs of printing for teachers' forum 207900 Techincal reports and texts 28400 Cost of printing per reort 4 Total cost of printing for reports and texts 113600 Printing and paper for continuing education 32500 Postage and shipping 200000 Teacher's forum subscription 23100 Cost of postage and shipping per magazine 4 Total costs of postage and shipping for teachers' forum 92400 Techincal reports and texts 28400 Cost of postage and shippingper reort 2 Total cost of postage and shipping for reports and texts 56800 Balance postage and shipping to corporate expenses 50800