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Prepare income statements segmented by client categories in three health-care-related industries

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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Clay Consulting Firm
Income Statement
For Month of July
Sales$ 900,000
Less variable costs(650,000)
Contribution margin250,000
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:

HospitalsPhysiciansNursing Care
Sales$ 350,000$ 250,000$ 300,000
Contribution margin ratio25%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
HospitalsPhysiciansNursing CareCompany Totals
Sales$Answer$Answer$Answer$Answer
Variable costsAnswerAnswerAnswerAnswer
Contribution marginAnswerAnswerAnswerAnswer
Direct fixed expensesAnswerAnswerAnswerAnswer
Product marginAnswerAnswerAnswerAnswer
Allocated common costsAnswerAnswerAnswerAnswer
Product income$Answer$Answer$AnswerAnswer
Unallocated common expenses:
Selling and administrativeAnswer
Service (less allocated expenses/costs)Answer
TotalAnswer
Net income$Answer

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