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# Segment Margin Statement and Segment-Margin Ratio

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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.

#### Solution Preview

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

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