Colasuonno Corporation Has Two Divisions: the West Division and the East

question 54

Multiple Choice

Colasuonno Corporation has two divisions: the West Division and the East Division.The corporation's net operating income is $88,800.The West Division's divisional segment margin is $39,500 and the East Division's divisional segment margin is $166,900.What is the amount of the common fixed expense not traceable to the individual divisions?

• A)$255,700
• B)$206,400
• C)$117,600
• D)$128,300

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Definitions:

Merchant

A person who deals in goods of the kind or by his occupation holds himself out as having knowledge or skill peculiar to the practices or goods involved in the transaction, or a person who employs an intermediary who, by her occu- pation, holds herself out as having such knowledge or skill.

Sale

A transaction between two parties where the buyer receives goods, services, or property in exchange for money.

Lease

A contractual agreement where one party (the lessee) pays the other (the lessor) for use of an asset for a specified period.

Express Warranties

Explicit guarantees provided by a seller to a buyer, assuring certain standards of quality and reliability for a product.