Figure 8-11. Tyler Company has the following information pertaining to its two product lines for 2011:
Common expenses are $105,000 for 2011.
Refer to Figure 8-11.What is the segment margin for Product B?
A)$155,000
B)$105,000
C)$85,000
D)$91,500

Question

Figure 8-11. Tyler Company has the following information pertaining to its two product lines for 2011:
 Common expenses are $105,000 for 2011.
Refer to Figure 8-11.What is the segment margin for Product B?
A)$155,000 
B)$105,000 
C)$85,000 
D)$91,500

Quizplus · Accepted Answer

To calculate the segment margin for Product B, we need to subtract the direct expenses for Product B ($453,000) from its sales revenue ($600,000), which gives us $147,000. Then we subtract this amount from the operating income of the Product B segment ($238,500), which gives us $91,500. Therefore, the segment margin for Product B is $91,500.