two divisions: the Beta Division and the Alpha Division. The Beta Division has sales of $235,000, variable expenses of $132,600, a traceable fixed expenses of $63,800. The Alpha Division has sales of $545,000, variable expenses of $309,800, an traceable fixed expenses of $121,500. The total amount of common fixed expenses not traceable to the individual divisions is $120,200. What is the company's net operating income

Question

Paul Mcpherson

Business

19 July, 17:36

two divisions: the Beta Division and the Alpha Division. The Beta Division has sales of $235,000, variable expenses of $132,600, a traceable fixed expenses of $63,800. The Alpha Division has sales of $545,000, variable expenses of $309,800, an traceable fixed expenses of $121,500. The total amount of common fixed expenses not traceable to the individual divisions is $120,200. What is the company's net operating income

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Antonio Hinton · Answer 1

Net operating income $32,100

Explanation:

The sum of the the two divisions sales and expenses would be the the reported figures for the entire company. The net operating income would be computed as follows

$

Total sales ($235,000 + $545,000) 780,000

Variables expenses (132,600 + 309,800) (442,400)

Contribution 337,600

Traceable fixed expenses (63,800 + 121,500) (185,300)

Common fixed expenses (120,200)

Net operating income 32,100