The Following Information Pertains to the South Territory of Sammy

question 127

Multiple Choice

The following information pertains to the South Territory of Sammy Company: $$\begin{array} { l l } \text { Net Sales } & \$ 5,000 \\\text { Variable costs: } & \\\text { Cost of merchandise sold } & 1,200 \\\text { Operating exp enses } & 450 \\\text { Fixed costs: } & \\\text { Controllable by segment manager } & 600 \\\text { Controllable by others } & 250 \\\text { Unalloc ated costs } & 150\end{array}$$ The contribution by segment is:

• A) $2,750
• B) $2,350
• C) $3,350
• D) $2,500

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Definitions:

Required Rate of Return

The minimum annual percentage return an investor expects to earn when investing in a particular asset or project.

Sales Revenue

The income received by a company from its sales of goods or the provision of services.

Operating Assets

Assets that are used in the daily operations of a business to generate revenue, excluding investment and financial assets.

Flexible Budget Graphs

Visual representations that display the relationship between budgeted and actual results over a range of activity levels, helping to analyze performance.