Author Question: Nobles Corporation provided the following segment margin income statement for two of its divisions: ... (Read 44 times)

olsonmanny@gmail.com · **on:** Feb 5, 2023

Nobles Corporation provided the following segment margin income statement for two of its divisions: East and West.

East

West

Total

Revenue	$510,000	$480,000	$990,000
Variable expenses
Product	370,000	260,000	630,000
Selling and administrative	80,000	88,000	168,000
Contribution margin	60,000	132,000	192,000
Less traceable fixed costs	20,000	40,000	60,000
Segment margin	$ 40,000	$ 92,000	132,000
Common fixed costs			140,000
Net operating income			($ 8,000)

Nobles' actual weighted-average cost of capital is 10% and its tax rate is 30%. The East division balance sheet showed $300,000 of assets ($60,000 current and $240,000 long-term) and $320,000 of liabilities ($120,000 current and $200,000 long-term). The West division reported $360,000 of assets ($80,000 current and $280,000 long-term) and $260,000 of liabilities ($60,000 current and $200,000 long-term).

Required:

a.	Calculate the economic value added for each division.

b.	Which of the two managers will be rated higher on performance? Why?

MistyHubbard · **Reply #1 on:** Feb 5, 2023

A FREE account is required to view all solutions!

Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.

Answer Preview

Only 60% of students answer this correctly