Pong Incorporated\'s segmented income statement for the most recent month is giv
ID: 2653486 • Letter: P
Question
Pong Incorporated's segmented income statement for the most recent month is given below.
Total Store A Store B
Sales $162,800 $68,100 $94,700
Variable expenses 57,012 28,602 28,410
Contribution margin 105,788 39,498 66,290
Traceable fixed expenses 69,800 23,200 46,600
Segment margin 35,988 $16,298 $19,690
Common fixed expenses 17,600
Net operating income $ 18,388
If Store B sales increase by $48,300 with no change in fixed expenses, the overall company net operating income should:
increase by $32,844
increase by $4,830
increase by $9,660
increase by $33,810
Explanation / Answer
There will be increase in total Income by $ 33810
VC = 28410/94700*100= 30% Increase in sales of B 48300 Increase In vC = 48300*30% 14490 Increase in income 33810