Jackson County Senior Services is a nonprofit organization devoted to providing essential services to seniors who live in their ownhomes within the Jackson County area. Three services are provided for seniors-home nursing, Meals On Wheels, and housekeeping.Data on revenue and expenses for the past year follow:RevenuesVariable expensesContribution marginFixed expenses:DepreciationLiability insurance.Program administrators' salariesGeneral administrative overhead*Total fixed expensesNet operating income (loss)Total$ 924,000469,000455,00070,50043,500114,100184,800412,900$ 42,100HomeNursing$ 264,000119,000145,0008,90020,30040,20052,800122, 200$ 22,800Meals OnWheels$ 409,000194,000215,00040,8007,30038,80081,800168, 700House-keeping$ 251,000156,00095,00020,80015,90035,10050,200122,000$ 46,300 $ (27,000)*Allocated on the basis of program revenues.The head administrator of Jackson County Senior Services, Judith Miyama, considers last year's net operating income of $42,100 to beunsatisfactory; therefore, she is considering the possibility of discontinuing the housekeeping program.The depreciation in housekeeping is for a small van that is used to carry the housekeepers and their equipment from job to job. If theprogram were discontinued, the van would be donated to a charitable organization. None of the general administrative overheadwould be avoided if the housekeeping program were dropped, but the liability insurance and the salary of the program administratorwould be avoided.Required:1-a. What is the financial advantage (disadvantage) of discontinuing the Housekeeping program?1-b. Based on the financial advantage (disadvantage) of discontinuing the Housekeeping program calculated in requirement Req 1A,should the Housekeeping program be discontinued?2-a. Prepare a properly formatted segmented income statement.2-b. Would a segmented income statement format be more useful to management in assessing the long-run financial viability of thevarious services?

A segmented contribution margin income statement is a financial report that displays the…

Jackson County Senior Services is a nonprofit organization devoted to providing essential services to seniors who live in their ov homes within the Jackson County area. Three services are provided for seniors-home nursing, Meals On Wheels, and housekeepin Data on revenue and expenses for the past year follow: Revenues Variable expenses. Contribution margin Fixed expenses: Depreciation Liability insurance. Program administrators' salaries General administrative overhead* Total fixed expenses Net operating income (loss) Total $ 924,000 469,000 455,000 70,500 43,500 Home Nursing $ 264,000 119,000 145,000 Meals On Wheels $ 409,000 194,000 215,000 40,800 7,300 House- keeping $ 251,000 156,000 95,000 20,800 15,900 35,100 50,200 122,000 8,900 20,300 114,100 40,200 38,800 184,800 52,800 81,800 412,900 122,200 168,700 $ 42,100 $ 22,800 $ 46,300 $ (27,000) *Allocated on the basis of program revenues. The head administrator of Jackson County Senior Services, Judith Miyama, considers last year's net operating income of $42,100 to b unsatisfactory; therefore, she is considering the possibility of discontinuing the housekeeping program. The depreciation in housekeeping is for a small van that is used to carry the housekeepers and their equipment from job to job. If the program were discontinued, the van would be donated to a charitable organization. None of the general administrative overhead would be avoided if the housekeeping program were dropped, but the liability insurance and the salary of the program administrator would be avoided. Required: 1-a. What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? 1-b. Based on the financial advantage (disadvantage) of discontinuing the Housekeeping program calculated in requirement Req 1A, should the Housekeeping program be discontinued? 2-a. Prepare a properly formatted segmented income statement. 2-b. Would a segmented income statement format be more useful to management in assessing the long-run financial viability of the various services?