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Tableau Dashboard Activity: Interpret and Communicate 4-1 (Static) [Exercise 4-5; LO4-5]

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Piedmont Company segments its business into two regions—North and South. The company prepared the contribution format segmented income statement as shown:

Total Company North South
Sales $ 600,000 $ 400,000 $ 200,000
Variable expenses 360,000 280,000 80,000
Contribution margin 240,000 120,000 120,000
Traceable fixed expenses 120,000 60,000 60,000
Segment margin 120,000 $ 60,000 $ 60,000
Common fixed expenses 50,000
Net operating income $ 70,000
Tableau Dashboard Activity 4-1 (Static) Part 2

2. The company used the above data to create a CVP graph for the North region and it wants your help interpreting the graph. Review the Tableau visualization that accompanies this requirement and answer the following questions:

a. The North segment’s traceable fixed expense is:

multiple choice 1

$120,000

$50,000

$80,000

$60,000

b. The North segment’s break-even point in dollar sales is:

multiple choice 2

$200,000

$36,000

$180,000

$170,000

c. The North’s segment margin when its sales are $300,000 is:

multiple choice 3

$50,000

$30,000

$80,000

$100,000

Hint: The North’s segment margin is determined by quantifying the gap between its total sales and total expense lines at a sales level

Answer 1

The North segment of Piedmont Company has traceable fixed expenses of $60,000. The break-even point and segment margin at specific sales levels are CVP concepts that would normally be determined using the CVP graph and related calculations, but cannot be conclusively answered here due to insufficient data.

Step-by-step explanation:

The question deals with interpreting a segmented income statement for Piedmont Company's North and South regions and understanding the related CVP (Cost-Volume-Profit) graph for the North region. Traceable fixed expenses, the break-even point in dollar sales, and the segment margin at a specified sales level are the core concepts being explored.

1. The North segment's traceable fixed expense is $60,000.
2. The North segment's break-even point in dollar sales can be calculated by setting the segment margin to zero and solving for sales. However, as the break-even point is asked as a multiple-choice question and the CVP graph details are not given here, we cannot accurately determine this value without additional information. Nevertheless, it's understood that the break-even point is where total sales equal total expenses, both variable and traceable fixed.
3. The North's segment margin when its sales are $300,000 can be determined by subtracting the sum of variable expenses and traceable fixed expenses from sales. If additional details from the CVP graph were provided, we could give a specific number