Question

Corbel Corporation has two divisions: Division A and Division B. Last month, the company reported a contribution margin of $42,100 for Division A. Division B had a contribution margin ratio of 35% and its sales were $220,000. Net operating income for the company was $34,200 and traceable fixed expenses were $50,100. Corbel Corporation's common fixed expenses were:

Answer 1

Common fixed costs= $34,800

Step-by-step explanation:

First, we need to calculate the contribution margin for Division B:

Contribution margin Division B= slaes*contribution margin ratio

Contribution margin Division B= 220,000*0.35

Contribution margin Division B= $77,000

Now, the segmented margin for both Divisions:

Segmented margin= (42,100 + 77,000) - 50,100

Segmented margin= $69,000

Finally, the common fixed costs:

Common fixed costs= segmented margin - net income

Common fixed costs= 69,000 - 34,200

Common fixed costs= $34,800