The Following Information Is Available for Discounted Supplies Inc Fixed Costs Controllable By

question 19

Multiple Choice

The following information is available for Discounted Supplies Inc.and its two divisions,Durable Goods and Nondurable Goods.
$$\begin{array} { l l l } &\text { Whole } & \text { Durable } & \text { Nondurable } \\&\text { Company } & \text { Goods } & \text { Goods } \\\hline \text { Net sales }&\$ 100,000 & \$ 60,000 & \$ 40,000\end{array}$$
Fixed costs controllable by
$\begin{array}{lll}\text { Division Manager }&16,500 & 12,500 & 4,000 \\\text { Fixed costs controlled by others }&8,000 & 5,000 & 3,000\end{array}$
Variable costs:
$\begin{array} { l } \text { Cost of merchandise sold}&24,500&17,500&7,000 \\ \text {Operating expenses }&16,400&10,000&6,400 \\ \text {Unallocated costs }& 1,000\\\end{array}$

What is the income before taxes for the company as a whole?

• A) $15,000
• B) $29,600
• C) $33,600
• D) $34,600

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Definitions:

Franchise Litigation

Legal disputes related to the rights, obligations, and agreements between franchisors and franchisees.

Wrongful Termination

The unfair or illegal firing of an employee in violation of contractual or statutory requirements.

Franchisee

An individual or entity that purchases the right to operate a business under the franchisor's brand name and business model.

Franchisor

A business entity that grants the right to an individual or group to carry out commercial activities using its brand and model.