Question

Data for Corporation and its two divisions, Domestic and Foreign, appear below:

Sales revenues, Domestic $541,000
Variable expenses, Domestic $314,000
Traceable fixed expenses, Domestic $64,800
Sales revenues, Foreign $418,300
Variable expenses, Foreign $238,700
Traceable fixed expenses, Foreign $54,200

In addition, common fixed expenses totaled $146,900 and were allocated as follows: $76,300 to the Domestic division and $70,600 to the Foreign division.

Required:
What is the segment margin for the Domestic division?

Answer 1

the segment margin for the Domestic division is $162,200

Step-by-step explanation:

The computation of the segment margin is as follows:

Segment Margin is

= Sales Revenues, Domestic - Variable Expenses, Domestic - Traceable Fixed Expenses, Domestic

= $541,000 - $314,000 - $64,800

= $162,200

Hence, the segment margin for the Domestic division is $162,200