I need the answer to 2A. Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its mostrecent monthly contribution format income statement:$ 1,000, ө00390,000610,000SalesVariable expensesContribution marginFixed expenses625, 000$ (15,000)Net operating income (loss)In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, theAccounting Department has developed the following information:DivisionEastCentralWest$ 250,00052%$ 400,00030%$ 350,000SalesVariable expenses as a percentage of salesTraceable fixed expenses40%$ 160,000$ 200,000$ 175,000Required:1. Prepare a contribution format income statement segmented by divisions.2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $15,000 based on the belief that itwould increase that division's sales by 20%. Assuming these estimates are accurate, how much would the company's net operatingincome increase (decrease) if the proposal is implemented?2-b. Would you recommend the increased advertising?

Contribution Margin: It is the part of sales revenue to cover the fixed costs of the company…

Answered: Wingate Company, a wholesale…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales Variable expenses Contribution margin Fixed expenses Net operating income (loss) $ 1,611,000 526,610 1,084,390 1,193,000 $ (108,610) In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following information: East Sales $ 411,000 Division Central $ 670,000 West $ 530,000 Variable expenses as a percentage of sales Traceable fixed expenses 51% 22% 32% $ 289,000 $ 325,000 $ 192,000 Required: 1. Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $21,000 based on the belief that it would increase that division's sales by 17%. Assuming these estimates are accurate, how much…
Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales Variable expenses Contribution margin Fixed expenses Net operating income (loss) $ 1,559,000 567,150 991,850 1,091,000 $ (99,150) In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following information: Sales Variable expenses as a percentage of sales Traceable fixed expenses East $ 359,000 $ 291,000 45% Division Central $ 640,000 24% $ 329,000 West 560,000 45% $ 204,000 Required: 1. Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $22,000 based on the belief that it would increase that division's sales by 12%. Assuming these estimates are accurate, how much would…
Wingate Company, a wholesale distributor of electronic equipment, has been experlencing losses for some time, as shown by Its most recent monthly contribution format Income statement: $ 1,671,00e 718, 890 Sales Variable expenses Contribution margin Fixed expenses 952,110 1,847, 000 Net operating income (loss) (94,890) In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following Information: Division East Central West Sales $431, 000 $660, 000 $580, e0e Variable expenses as a percentage of sales Traceable fixed expenses 59% 37% 38% $270, 00e $ 340, 000 $ 207,000 Requlred: 1. Prepare a contribution format Income statement segmented by divisions. 2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $27,000 based on the bellef that it would increase that division's sales by 14%. Assuming these estimates are accurate, how much…
Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales Variable expenses Contribution margin Fixed expenses 5 Net operating income (loss) $ 1,580,000 528,900 1,051,100 1,156,000 $ (104,900) In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following information: East Sales Variable expenses as a percentage of sales Traceable fixed expenses $ 400,000 Division Central $ 610,000 West $570,000 43% 23% 38% $ 259,000 $ 331,000 $ 210,000 Required: 1. Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $23,000 based on the belief that it would increase that division's sales by 13%. Assuming these estimates are accurate, how much…
Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales $ 1,644,000 Variable expenses 608,620 Contribution margin 1,035,380 Fixed expenses 1,139,000 Net operating income (loss) $ (103,620) In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following information: Division East Central West Sales $ 444,000 $ 650,000 $ 550,000 Variable expenses as a percentage of sales 48% 27% 40% Traceable fixed expenses $ 282,000 $ 335,000 $ 200,000 Required: 1. Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $20,000 based on the belief that it would increase that division's sales by 14%. Assuming…
A company is a wholesale distributor of electronic equipment who has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales P 1,000,000Variable expenses 390,000Contribution Margin 610,000Fixed Expenses 625,000Net operating Income (loss) P(15,000) In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following information: Division East Central WestSales P250,000 P400,000 P350,000Variable expenses as a percentage of sales 52% 30% 40%Traceable Fixed Expenses P160,000 P200,000 P175,000 Required: a. Prepare a contribution format income statement segmented by the division. East Central West b. The marketing department has proposed increasing the West Division’s monthly advertising by P15,000 believing that it…
Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format Income statement: sales variable expenses Contribution margin Fixed expenses $ 1,610,000 551,400 Net operating income (loss) 1,058,600 1,164,000 $ (105,400) In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following Information: Sales East $410,000 Division Central $ 670,000 West $530,000 Variable expenses as a percentage of sales Traceable fixed expenses 52% 22% 36% $ 278,000 $ 326,000 $ 200,000 Required: 1. Prepare a contribution format Income statement segmented by divisions. 2-8. The Marketing Department has proposed increasing the West Division's monthly advertising by $27,000 based on the belief that it would increase that division's sales by 13%. Assuming these estimates are accurate, how much…
Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales $ 1,610,000 Variable expenses 659,000 Contribution margin 951,000 Fixed expenses 1,046,000 Net operating income (loss) $ (95,000) In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following information: Division East Central West Sales $ 430,000 $ 610,000 $ 570,000 Variable expenses as a percentage of sales 52 % 34 % 40 % Traceable fixed expenses $ 288,000 $ 321,000 $ 193,000 Required: 1. Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $29,000 based on the belief that it would…
Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses as shown by its most recent monthly contribution format Income statement: Sales Variable expenses Contribution margin Fixed expenses Net operating income (loss) $ 1,601,000 530,090 1,070,910 1,178,000 $ (107,090) In an effort to resolve the problem, the company wants to prepare an Income statement segmented by division. Accordingly, the Accounting Department provided the following Information: Sales Variable expenses as a percentage of sales Traceable fixed expenses East $ 401,000 49% $ 293,000 Required 1 Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 2B Prepare a contribution format income statement segmented by divisions. Required: 1. Prepare a contribution format Income statement segmented by divisions. 2-a. The Marketing Department belleves increasing the West Division's monthly advertising by $30,000 will increase that division's sales…
Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses as shown by its most recent monthly contribution format income statement: Sales Variable expenses Contribution margin Fixed expenses Net operating income (loss) $ 1,551,000 618,590 932,410 1,026,000 $ (93,590) In an effort to resolve the problem, the company wants to prepare an income statement segmented by division. Accordingly, the Accounting Department provided the following information: Sales Variable expenses as a percentage of sales Traceable fixed expenses East $ 381,000 49% $ 259,000 Division Central $ 610,000 35% $ 324,000 West $ 560,000 39% $ 195,000 Required: 1. Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department believes increasing the West Division's monthly advertising by $29,000 will increase that division's sales by 14%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease)…
Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales Variable expenses Contribution margin Fixed expenses Net operating income (loss) In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following information: Sales Variable expenses as a percentage of sales Traceable fixed expenses $ 1,546,000 670, 180 875,820 963,000 $ (87,180) Req 1 Req 2A East $ 386,000 58% $ 251,000 Required: 1. Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $26,000 based on the belief that it would increase that division's sales by 14%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease)…
Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement, which follows: Sales $1,603,000 635,970 Variable expenses 967,030 Contribution margin 1,064,000 Fixed expenses Net operating income (loss) $ (96,970) In an effort to isolate the problem, the president has asked for an income statement segmented by division. Accordingly, the Accounting Department has developed the following information: Division West Central $393,000 $610,000 $600,000 East Sales Variable expenses as a percentage of sales Traceable fixed expenses 21% $280,000 $322,000 $ 190,000 59% 46% Required: 1. Prepare a contribution format income statement segmented by divisions, as desired by the president. Division Total East Central West Company 2- As a result of a marketing study, the president believes that sales in the a. West Division could be increased by 15% if monthly advertising in that…

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