A properly constructed segmented income statement in a contribution format would show that the segment margin of the North business segment is:

A) $105,000
B) $383,000
C) $198,000
D) $184,000

Question

A properly constructed segmented income statement in a contribution format would show that the segment margin of the North business segment is:A) $105,000B) $383,000C) $198,000D) $184,000

Tyshekia Turner · Accepted Answer

Final Answer : C, Explanation :  The contribution format income statement separates costs into variable and fixed categories, with a section for each. The segment margin is calculated by subtracting the variable costs from the segment's revenue and then subtracting the segment's fixed costs from that result. The segmented income statement should show the segment margin for each business segment. Therefore, by identifying the segment margin for the North business segment on the contribution income statement, we can determine the correct answer. Choice C, $198,000, is the segment margin for the North business segment.

A properly constructed segmented income statement in a contribution format would show that the segment margin of the North business segment is:

A) $105,000
B) $383,000
C) $198,000
D) $184,000

Definitions

Learning Objectives

Learning Objectives

Related questions