Redding Company has two divisions with the following segment margins for the current year: Northern, $200,000; Southern, $400,000. Common expenses of the company are $50,000. What is Redding Company's income?
A) $150,000
B) $550,000
C) $600,000
D) $650,000

Question

Quizplus · Accepted Answer

To find the company's income, we need to add the segment margins and subtract the common expenses. 
Total Segment Margin = $200,000 + $400,000 = $600,000 
Total Income = Total Segment Margin - Common Expenses = $600,000 - $50,000 = $550,000

Redding Company Has Two Divisions with the Following Segment Margins