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19 February, 23:26

Delisa Corporation has two divisions: Division L and Division Q.

Data from the most recent month appear below:

Total Company Division L Division Q

Sales $ 510,000 $153,000 $357,000

Variable expenses 312,120 87,210 224,910

Contribution margin 197,880 65,790 132,090

Traceable fixed expenses 113,360 35,280 78,080

Segment margin 84,520 $30,510 $54,010

Common fixed expenses 65,040

Net operating income $19,480

The break-even in sales dollars for Division Q is closest to: (Round your intermediate calculations to 2 decimal places.)

a) $291,760 b) $211,027 c) $227,175 d) $395,760

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  1. 20 February, 01:36
    0
    b) $211,027

    Explanation:

    Break Even Sales Volume in Dollars = Fixed Costs / 1 - (variable Costs / Sales)

    Break Even Sales Volume in Dollars = 78080/1 - (224910/357,000)

    Break Even Sales Volume in Dollars = 78080/1-0.63

    Break Even Sales Volume in Dollars = 78080/0.37

    Break Even Sales Volume in Dollars=$211,027.027

    Working

    Total Company Division L Division Q

    Sales $ 510,000 $153,000 $357,000

    Variable expenses 312,120 87,210 224,910

    Contribution margin 197,880 65,790 132,090

    Traceable fixed expenses 113,360 35,280 78,080

    Segment margin 84,520 $30,510 $54,010

    Common fixed expenses 65,040

    Net operating income $19,480
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