Question

Required informatio [The following information applies to the questions displayed below.] Raner, Harris & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company's most recent year is given Office Total Company Chicago Minneapolis 414,000 276,000 40 Sales Variable expenses Contribution marain Traceable fixed expenses Office segment margin Common fixed expenses not traceable to offices Net operating income $862,500 100.0% 54,0% $172,500 100% 30% $690,000 100% 60% 465,750 396,750 46.0% 193,200 22.4% 51,750 12.750 70% 52% 18% 89,700 103,500 172,500 15% 25% 203,550 23.6% $ 31,050 138,000 $ 16.0% 7.6% $65,550 3. Assume that sales in Chicago increase by $57,500 next year and that sales in Minneapolis remain unchanged. Assume no change in fixed costs a. Prepare a new segmented income statement for the company. (Round your percentage answers to 1 decimal place (i.e. 0.1234 should be entered as 12.3).) Segments Total Company Chicago Minneapolis Amount Amount Amount Sales 100.0

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trying to find out how much it is increased by......

Answer 1

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Statementshowing Computations
	Total company		Chicago		Minneapolis
Paticulars	Amount	%	Amount	%	Amount	%
Sales	920,000.00	100.00%	230,000.00	100.00%	690,000.00	100.00%
Variable expenses	483,000.00	52.50%	69,000.00	30.00%	414,000.00	60.00%
Contribution margin	437,000.00	47.50%	161,000.00	70.00%	276,000.00	40.00%
traceable fixed expenses	193,200.00	21.00%	89,700.00	39.00%	103,500.00	15.00%
Office segment margin	243,800.00	26.50%	71,300.00	31.00%	172,500.00	25.00%
Common fixed expenses not traceable to segments	138,000.00	15.00%
Net operating income	105,800.00	11.50%