Mossor Corporation Has Two Major Business Segments-Retail and Wholesale

question 61

Essay

Mossor Corporation has two major business segments-Retail and Wholesale.In December,the Retail business segment had sales revenues of $510,000,variable expenses of $296,000,and traceable fixed expenses of $61,000.During the same month,the Wholesale business segment had sales revenues of $510,000,variable expenses of $240,000,and traceable fixed expenses of $82,000.Common fixed expenses totaled $191,000 and were allocated as follows: $113,000 to the Retail business segment and $78,000 to the Wholesale business segment.
Required:
Prepare a segmented income statement in the contribution format for the company.Omit percentages;show only dollar amounts.

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Definitions:

Risk Averse

A description of an individual or entity that prefers to avoid risk and would choose a certain outcome over a gamble with a potentially higher, but uncertain, return.

Portfolio

A group of investment vehicles comprising stocks, bonds, commodities, as well as cash and its equivalents, together with mutual funds and ETFs.

Adverse Selection

Adverse selection refers to a situation where sellers have information that buyers do not, or vice versa, about some aspect of product quality.

Utility Function

A mathematical representation of how consumers rank different bundles of goods according to their level of satisfaction or utility.