Question

Tyler Company has the following information pertaining to its two product lines for last year: Product A Product B Variable selling and admin. expenses $38,000 $31,000 Direct fixed expenses 19,500 34,500 Sales 250,000 210,000 Direct fixed selling and admin. expenses 38,000 22,000 Variable expenses 42,000 31,000 Operating income $112,500 $91,500 Common expenses are $105,000 for the year. What is the segment margin for Product B?

Answer 1

D. $91,500

Step-by-step explanation:

Answer is calculated below.

Segment margin for Product B = $210,000 - $31,000 - $34,500 - $22,000 - $31,000 = $91,500

Answer 2

Segment margin for Product B is $91,500

Step-by-step explanation:

Segment margin for Product B is calculated as,

Segment margin of product B = Sales - variable expenses - direct fixed expenses - direct fixed selling and ending expenses

Segment margin of product = $210,000 - $31,000 - $34,500 - $22,000 - $31,000 = $91,500

Hence, Segment margin for Product B is $91,500.