Exhibit 7-4
the Following Segmented Annual Income Statement Is for Paper

question 15

Multiple Choice

Exhibit 7-4
The following segmented annual income statement is for Paper Products,Inc.
$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$$\text { Product Lines }$
$\begin{array}{lrrrr}& \text { Plain } & \text { Lined } & \text { Color } & \text { Total }\\\text { Sales revenue } & \$ 25,000 & \$ 100,000 & \$ 125,000 & \$ 250,000 \\\text { Variable costs } & 15,000 & 50,000 & 85,000 & 150,000\\\text { Contribution margin } & \$ 10,000 & \$ 50,000 & \$ 40,000 & \$ 100,000 \\\text { Direct fixed costs } & 4,000 & 6,000 & 9,000 & 19,000\\\text {Allocated fixed costs }&\underline{\quad?\quad}&\underline{\quad?\quad}&\underline{\quad?\quad}&\underline{45,000}\\\text {Profit (loss) }&\underline{\$\quad?\quad}&\underline{\$\quad?\quad}&\underline{\$\quad?\quad}&\underline{\$\quad?\quad}\end{array}$

-Refer to Exhibit 7-4.If allocated fixed costs are based on sales revenue for each product line as a proportion of total sales revenue,what is the profit or (loss) for Lined?

• A)$29,000
• B)$26,000
• C)$44,000
• D)$21,500
• E)None of the answer choices is correct.

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Definitions:

Dispositional Contempt

An attitude or feeling of disdain or scorn towards others, typically viewed as a stable personality trait.

Deal-Breakers

Factors or behaviors that, once present, can terminate a relationship or negotiation because one party finds them unacceptable.

Emotionally Unavailable

An inability or unwillingness to share emotions or emotionally engage with others.

Controlling

The act or process of directing or influencing the behavior of others or the course of events, often with authority or manipulation.