The Following Information Is Available for Pet Store Company and Its

question 5

Essay

The following information is available for Pet Store Company and its two divisions,Pet Supplies and Training.
$\begin{array}{lll}&\text { Whole } & \text { Pet Supplies } & \text { Training } \\&\text { Company } & \text { Division } & \text { Division }\\\text { Net sales }&\$170,000&\$70,000&\$100,000\end{array}$
Fixed costs:
$\begin{array}{lll}\text { Controllable by division managers }&16,000 & 10,000 & 6,000 \\\text { Controllable by others }&8,000 & 6,000 & 2,000\end{array}$
Variable costs:
$\begin{array}{llll}\text { Cost of merchandise sold } & 46,000 & 28,000 & 18,000 \\\text { Operating expenses } & 14,000 & 8,000 & 6,000 \\\text { Unallocated costs } & 14,000 &\end{array}$
Required:
A) Compute the contribution margin for the Pet Supplies Division.
B) Compute the contribution controllable by the manager of the Training Division.
C) Compute the contribution by segment for the Training Division.
D) Compute the income before taxes for the whole company.

• A) Compute the contribution margin for the Pet Supplies Division.
• B) Compute the contribution controllable by the manager of the Training Division.
• C) Compute the contribution by segment for the Training Division.
• D) Compute the income before taxes for the whole company.

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Definitions:

Corrugator Supercilii

A facial muscle located beneath the forehead skin, responsible for drawing the eyebrows together and downward.

Orbicularis Oculi

A facial muscle that encircles the eye socket and is responsible for closing the eyelids.

Orbicularis Oris

A complex of muscles in the lips that encircles the mouth, involved in controlling movements of the mouth and lips.

Frontalis

A facial muscle that lifts the eyebrows and causes wrinkles on the forehead, being part of the occipitofrontalis muscle.