Tubaugh Corporation Has Two Major Business Segments--East and West

question 271

Multiple Choice

Tubaugh Corporation has two major business segments--East and West. In December, the East business segment had sales revenues of $690,000, variable expenses of $352,000, and traceable fixed expenses of $104,000. During the same month, the West business segment had sales revenues of $140,000, variable expenses of $56,000, and traceable fixed expenses of $24,000. The common fixed expenses totaled $162,000 and were allocated as follows: $89,000 to the East business segment and $73,000 to the West business segment.
-A properly constructed segmented income statement in a contribution format would show that the net operating income of the company as a whole is:

• A) $294,000
• B) $422,000
• C) $132,000
• D) ($30,000)

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Definitions:

Discharge

The act of releasing or expelling a substance, especially the flow of a liquid from a container or the flow of a river into a larger body of water.

Tributaries

Streams or rivers that flow into a larger river or body of water.

Stream Velocities

The speed at which water flows in a stream or river, influenced by slope, channel shape, and volume of water.

Suspension

A mode of sediment transport in which water or wind picks up and carries the sediment as floating particles.