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Author Question: Jackson Brothers Instruments sells stringed instruments. Trent Jackson, the company's president, ... (Read 42 times)

dusk108

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on: Feb 5, 2023
Jackson Brothers Instruments sells stringed instruments. Trent Jackson, the company's president, just received the following income statement reporting the results of the past year.
​
​BanjosGuitarsFiddlesTotal
Sales revenue$1,250,000 $3,600,000$2,380,000 $7,230,000
Variable cost of goods sold     850,000  2,340,000  1,904,000  5,094,000
Fixed cost of goods sold    115,000    188,000    166,000    469,000
Gross profit     285,000  1,072,000     310,000  1,667,000
Variable operating expenses     170,000     675,000     238,000  1,083,000
Fixed operating expenses       85,000       80,000       83,000     248,000
Common fixed costs     40,000    110,000     77,000   227,000
Operating income$  (10,000)$   207,000($   88,000)$  109,000

Trent is concerned that two of the company's divisions are showing a loss, and he wonders if the company should stop selling Banjos and Fiddles to concentrate solely on guitars.

Required:

a.Prepare a segment margin income statement. Omit the heading. Fixed cost of goods
sold and fixed operating expenses can be traced to each division.
b.Should Trent close the banjos and fiddles divisions? Why or why not?
c.Trent wants to change the allocation method used to allocate common fixed costs to
the divisions. His plan is to allocate these costs based on sales revenue. Will this new allocation method change your decision on whether to close the guitars and fiddles divisions? Why or why not?
Managerial Accounting ¦ Davis ¦ 4th Edition
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Marked as best answer by dusk108 on Feb 5, 2023

avelasquez

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Reply #1 on: Feb 5, 2023
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.
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dusk108

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Reply 2 on: Feb 5, 2023
Excellent

smrtceo

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Reply 3 on: Yesterday
Great answer, keep it coming :)

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