Explore BrainMass

Explore BrainMass

    Segment Margin Statement and Segment-Margin Ratio

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    The company reports the following costs and revenues for one of its segments:

    Net sales revenue . . . . . . . . . . . . $728,000
    Cost of goods sold . . . . . . . . . . . . 416,000
    Selling and administrative costs . . . . . 104,000
    Advertising cost . . . . . . . . . . . . . 62,400
    Insurance cost . . . . . . . . . . . . . . 82,000

    Of these costs, cost of goods sold and selling and administrative costs are variable, advertising is a direct fixed cost, and insurance is an indirect fixed cost. Using this information, prepare a segment margin statement for this segment.

    Segment-Margin Ratio
    Using the information for the problem above, compute the segment-margin ratio.

    © BrainMass Inc. brainmass.com June 3, 2020, 9:55 pm ad1c9bdddf
    https://brainmass.com/business/financial-ratios/segment-margin-statement-and-segment-margin-ratio-205413

    Solution Preview

    Please see the attached file

    The company reports the following costs and revenues for one of its segments:

    Net sales revenue . . . . . . . . . . . . $728,000
    Cost of goods sold . . . . . . . . . . . . 416,000
    Selling and administrative costs . . . . . 104,000
    Advertising cost . . . . . . . . . . . . ...

    Solution Summary

    The solution explains how to prepare a segment margin statement and use it to calculate the segmetn margin ratio

    $2.19

    ADVERTISEMENT