ACCT 505 help A Guide to career/uophelp.com ACCT 505 help A Guide to career/uophelp.com | Page 78

Question 1. Question : (TCO D) Data for December concerning
Dinnocenzo Corporation's two major business segments-Fibers and
Feedstocks-appear below.
Sales revenues, Fibers $870,000
Sales revenues, Feedstocks $820,000
Variable expenses, Fibers $426,000
Variable expenses, Feedstocks $344,000
Traceable fixed expenses, Fibers $148,000
Traceable fixed expenses, Feedstocks $156,000
Common fixed expenses totaled $314,000 and were allocated as follows:
$129,000 to the Fibers business segment and $185,000 to the Feedstocks
business segment.
Required:
Prepare a segmented income statement in the contribution format for the
company. Omit percentages; show only dollar amounts.
Question 2. Question : (TCO D) Wryski Corporation had net operating
income of $150,000 and average operating assets of $500,000. The
company requires a return on investment of 19%.
Required:
i. Calculate the company's current return on investment and residual
income.
ii. The company is investigating an investment of $400,000 in a project
that will generate annual net operating income of $78,000. What is the
ROI of the project? What is the residual income of the project? Should
the company invest in this project?
ii. Return on investment = Net operating income / Average operating
assets = $78,000 / $400,000 = 19.5%
Question 3. Question : (TCO D) Tjelmeland Corporation is considering
dropping product S85U. Data from the company's accounting system
appear below.
Sales $360,000
Variable Expenses $158,000
Fixed Manufacturing Expenses $119,000
Fixed Selling and Administrative Expenses $94,000