Barmore Company has the following information pertaining to its two divisions for the current year:
$\begin{array}{lrr}
&\text { Division } A&\text { Division } B\
\text { Variable selling and admin. expenses } & \$ 35,000 & \$ 45,000 \
\text { Direct fixed manufacturing expenses } & 17,500 & 50,000 \
\text { Sales } & 100,000 & 200,000 \
\text { Direct fixed selling and admin. expenses } & 15,000 & 35,000 \
\text { Variable manufacturing expenses } & 20,000 & 50,000
\end{array}$ Common expenses are $12,000 for the current year.
-Refer to the figure.What is the net income for Barmore Company?
A)$20,500
B)$32,500
C)$150,000
D)$300,000

Question

Barmore Company has the following information pertaining to its two divisions for the current year:
$\begin{array}{lrr}
&\text { Division } A&\text { Division } B\
\text { Variable selling and admin. expenses } & \$ 35,000 & \$ 45,000 \
\text { Direct fixed manufacturing expenses } & 17,500 & 50,000 \
\text { Sales } & 100,000 & 200,000 \
\text { Direct fixed selling and admin. expenses } & 15,000 & 35,000 \
\text { Variable manufacturing expenses } & 20,000 & 50,000
\end{array}$  Common expenses are $12,000 for the current year.
-Refer to the figure.What is the net income for Barmore Company?
A)$20,500
B)$32,500
C)$150,000
D)$300,000

Quizplus · Accepted Answer

Net income is calculated as sales minus all expenses. For Division A, net income is $100,000 - $35,000 - $17,500 - $15,000 - $20,000 = $12,500. For Division B, net income is $200,000 - $45,000 - $50,000 - $35,000 - $50,000 = $20,000. Total net income for Barmore Company is $12,500 + $20,000 + $12,000 (common expenses) = $44,500.

Barmore Company Has the Following Information Pertaining to Its Two