Question

Exceptional Events provides event management services. The company has three​ employees, each assigned to specific customers. The company considers each​ employee's territory as a business segment. The following data relate to its three segments for the month of​ June: Maribel Jessica Timothy Sale revenue $ 6 comma 000 $ 10 comma 700 $ 12 comma 350 Variable costs $ 5 comma 900 $ 7 comma 100 $ 12 comma 000 The business segments had the following number of​ customers: Maribel, 26​; ​ Jessica, 29​; and​ Timothy, 35. The total fixed costs for the month amount to $ 3 comma 500. What is the operating income of Exceptional Events for the month of​ June? A. $ 100 B. $ 4 comma 050 C. $ 29 comma 050 D. $ 550

Answer 1

Net operating income= $550

Step-by-step explanation:

Giving the following information:

Maribel:

Sales= $6,000

Variable cost= $5,900

Contribution margin= $100

Jessica:

Sales= $10,700

Variable cost= $7,100

Contribution margin= $3,600

Timothy:

Sales= $12,350

Variable costs= $12,000

Contribution margin= $350

The total fixed costs for the month amount to $3,500.

Net operating income= contribution margin - fixed costs

Net operating income= (100 + 3,600 + 350) - 3,500= $550