A National Retail Company Has Segmented Its Income Statement by Sales

question 56

Multiple Choice

A national retail company has segmented its income statement by sales territories. If each sales territory statement is further segmented by individual stores, which of the following will most likely occur?

• A)some common fixed expenses in the sales territory segmented statement will become traceable fixed expenses in the individual store segmented statement.
• B)some traceable fixed expenses in the sales territory segmented statement will become common fixed expenses in the individual store segmented statement.
• C)the sum total of the individual stores' segment margins in each sales territory will be equal to the segment margin for the sales territory.
• D)the sum total of the sales territory segment margins will equal the total net operating income for the entire company.

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Definitions:

Information Processing

A theory describing how the human mind takes in, stores, retrieves, and uses information, likening the mind to a computer.

Sensory Storage

The initial process of storing information, taken in through the senses, for a very brief period.

Memory Capacity

The amount of information that can be held in the memory system at one time, varying across short-term and long-term memory stores.

Age

The length of time that a person or object has existed, typically measured in years from the date of birth or creation.