Income Statements Segmented by Products
Clay Consulting Firm provides three types of client services in three health-care-related industries. The income statement for July is as follows:
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Prepare income statements segmented by client categories in three health-care-related industries
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Clay Consulting Firm Income Statement For Month of July | ||
---|---|---|
Sales | $ 900,000 | |
Less variable costs | (650,000) | |
Contribution margin | 250,000 | |
Less fixed expenses | ||
Service | $(70,000) | |
Selling and administrative | (65,000) | (135,000) |
Net income | $ 115,000 |
The sales, contribution margin ratios, and direct fixed expenses for the three types of services are as follows:
Hospitals | Physicians | Nursing Care | |
---|---|---|---|
Sales | $ 350,000 | $ 250,000 | $ 300,000 |
Contribution margin ratio | 25% | 35% | 25% |
Direct fixed expenses of service | $ 20,000 | $ 18,000 | $ 16,000 |
Allocated common fixed service expenses | $ 1,000 | $ 1,000 | $ 1,500 |
Prepare income statements segmented by client categories. Include a column for the entire firm in the statement.
Use negative signs with all answers relating to expenses and costs.
Clay Consulting Firm Product and Company Income Statements For the Month of July | ||||
---|---|---|---|---|
Hospitals | Physicians | Nursing Care | Company Totals | |
Sales | $Answer | $Answer | $Answer | $Answer |
Variable costs | Answer | Answer | Answer | Answer |
Contribution margin | Answer | Answer | Answer | Answer |
Direct fixed expenses | Answer | Answer | Answer | Answer |
Product margin | Answer | Answer | Answer | Answer |
Allocated common costs | Answer | Answer | Answer | Answer |
Product income | $Answer | $Answer | $Answer | Answer |
Unallocated common expenses: | ||||
Selling and administrative | Answer | |||
Service (less allocated expenses/costs) | Answer | |||
Total | Answer | |||
Net income | $Answer |