Compute operating income, contribution margin, income of each
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X Y Z
Sales $400 $200 $80
Variable expenses 128 52 34
Fixed expenses
Unavoidable 96 52 12
Avoidable 116 104 54
a. compute the operating income of the company
b. compute the contribution margin and operating income of each department
c. should any department be eliminated, if so which ones and why?
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This solution is comprised of a detailed explanation to compute the operating income of the company.
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X Y Z Total
Sales $400 $200 $80 680
Variable expenses 128 52 34 214
Fixed expenses
Unavoidable 96 52 12 160
Avoidable 116 104 54 274
a. Compute the operating income of the company
680 - 214 - 160 - 274 = ...
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