Leeds Services Provides Event Management Services The Business Segments Had the Following Number of Customers: Matt,26

question 3

Multiple Choice

Leeds Services provides event management services.The company has three employees,each assigned to specific customers.The company considers each employee's territory as a business segment.The following data relate to its three segments for the month of June: $$\begin{array} { | l | r | r | r | } \hline & \text { Matt } & \text { Andrea } & \text { Doug } \\\hline \text { Sale Revenue } & \$ 6,000 & \$ 11,800 & \$ 14,350 \\\hline \text { Variable costs } & \$ 5,900 & \$ 5,200 & \$ 11,500 \\\hline\end{array}$$ The business segments had the following number of customers: Matt,26 ; Andrea,29; and Doug,35.The total fixed costs for the month of June amounts to $3,400.Which business segment was the most profitable?

• A)Matt
• B)Andrea
• C)Doug
• D)Both Matt and Andrea are equally profitable

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Definitions:

Uncollectibles

Debts from customers that are considered impossible to collect and are therefore written off as a loss.

Expense with Revenues

Represents the relationship between the costs incurred and the revenues generated in a specific period.

Direct Write-off Method

An accounting method for treating bad debts that writes off specific invoices as uncollectable only at the time they are deemed irrecoverable.

Allowance Method

An accounting technique used to estimate and account for doubtful accounts, providing a more accurate reflection of realizable revenue.