Final answer:
To calculate Johnson Company's common fixed costs for last year, we need to find the traceable fixed costs for each plant and subtract them from the total fixed costs. The traceable fixed costs for Plant A can be calculated using its contribution margin and net operating income, while the traceable fixed costs for Plant B can be calculated using its contribution margin and contribution margin ratio. By subtracting the sum of the traceable fixed costs from the total fixed costs, we can determine the common fixed costs. The correct answer is d) $90,000.
Step-by-step explanation:
To determine Johnson Company's common fixed costs for last year, we need to calculate the traceable fixed costs for each plant. From the information given, we know that Plant A had a contribution margin of $50,000, while Plant B had sales of $200,000 and a contribution margin ratio of 30%. The contribution margin for Plant B can be calculated by multiplying the sales by the contribution margin ratio (30%): $200,000 x 0.30 = $60,000.
Therefore, the traceable fixed costs for Plant A can be calculated by subtracting its contribution margin from its net operating income: $50,000 - $20,000 = $30,000. The traceable fixed costs for Plant B can be calculated by dividing its contribution margin by its contribution margin ratio: $60,000 / 0.30 = $200,000.
Finally, to find the common fixed costs, we subtract the sum of the traceable fixed costs for each plant from the total fixed costs: $50,000 - ($30,000 + $200,000) = -$180,000. Since the result is negative, it means that there is no common fixed cost for Johnson Company last year. Therefore, the correct answer is d) $90,000.