Question

Nantor Corporation has two divisions, Southern and Northern. The following information was taken from last year's income statement segmented by division: Total Company Southern Northern Sales $ 5,600,000 $ 3,460,000 $ 2,140,000 Contribution margin $ 2,450,000 $ 1,530,000 $ 920,000 Divisional segment margin $ 1,330,000 $ 1,020,000 $ 310,000 Net operating income last year for Nantor Corporation was $560,000. In last year's income statement segmented by division, what were Nantor's total common fixed expenses

Answer 1

the total common fixed expense is $770,000

Step-by-step explanation:

The computation of the total common fixed expense is shown below:

= Total company divisional segment margin - net operating income last year

= $1,330,000 - $560,000

= $770,000

Hence, the total common fixed expense is $770,000

We simply applied the above formula