Data for September for Mossman Corporation and its two major business segments, North and South, appear below: In addition, common fixed expenses totaled $319,000 and were allocated as follows: $160,000 to the North business segment and $159,000 to the South 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) $211,000
B) $51,000
C) $259,000
D) $121,000

Question

Data for September for Mossman Corporation and its two major business segments, North and South, appear below:  In addition, common fixed expenses totaled $319,000 and were allocated as follows: $160,000 to the North business segment and $159,000 to the South 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) $211,000 
B) $51,000 
C) $259,000 
D) $121,000

Quizplus · Accepted Answer

The segment margin is calculated by subtracting variable costs from sales revenue. In this case, the North business segment has sales revenue of $360,000 and variable costs of $149,000, resulting in a segment margin of $211,000.

Data for September for Mossman Corporation and Its Two Major