The Delta Division of Georgia Corporation Generated Net Revenues of $6,000,000

question 72

Short Answer

The Delta division of Georgia Corporation generated net revenues of $6,000,000 and variable expenses of $3,500,000 during the year.If direct fixed costs were $1,000,000 and the segment margin was $1,500,000,what are the common corporate fixed costs?
a.$1,500,000
b.$4,500,000
c.$5,00,000
d.The answer cannot be determined from the information given.

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Definitions:

Impairment Test

An examination carried out to determine if the carrying amount of an asset exceeds its recoverable amount, potentially leading to an impairment loss.

Reversal

The process of undoing or nullifying a previous accounting entry or transaction.

Impairment Loss

The difference when the recorded value of an asset or a cash-producing entity surpasses the amount it can be recovered for.