Consider the Following Portion of a Segmented Income Statement for the Year

question 42

Multiple Choice

Consider the following portion of a segmented income statement for the year just ended. Assume that the fixed expenses of Division X include $30,000 of direct expenses and that the discontinuance of the department will not affect the sales of the other departments nor reduce the common expenses. $$\begin{array} { l r } & \text { Division } x \\\text { Sales } & \$ 100,000 \\\text { Variable manufacturing costs } & 60,000 \\ \text { Gross profit }& \$ 40,000 \\\text { Fixed expenses (direct and allocated) }& 50,000 \\\text { Operating income (loss) } & \$ ( 10,000 ) \end{array}$$ What is X's divisional segment margin?

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Definitions:

Republican Party

One of the two major contemporary political parties in the United States, commonly associated with conservative ideologies, favoring smaller government, lower taxes, and a strong national defense.

Economic Development

The process of improving economic well-being and quality of life through growth and advancement, often measured by GDP growth, employment rates, and infrastructure improvements.

Slavery

A system in which individuals are owned by others as property, deprived of personal freedom, and compelled to perform labor or services.

Kansas-Nebraska Bill

Legislation passed by the U.S. Congress in 1854 that allowed residents of Kansas and Nebraska territories to decide whether to allow slavery, leading to violent conflict in the region known as "Bleeding Kansas."