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Segmented Income Statement

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Countywide Cable Services, Inc. is organized with three segments: Metro, Suburban, and outlying. Data for these segments for the year just ended follow.
Metro Suburban Outlying
Service revenue....... $1,000,000 $800,000 $400,000
Variable expenses.... 200,000 150,000 100,000
Controllable fixed exp 400,000 320,000 150,000
Fixed exp controllable 230,000 200,000 90,000

In addition to the expenses listed above, the company has $95,000 of common
fixed expenses. Income-tax expense for the year is $145,000.

1. Prepare a segmented income statement for Countywide Cable Service, Inc.Use the contribution format.

2. Build a spreadsheet: Construct an Excel spreadsheet to solve the
preceding requirement. Show how the solution will change if the following
information changes: the sales revenues were $950,000 and $815,000 for
Metro and Suburban, respectively.

Solution Summary

The solution explains how to prepare a segmented income statement using the contribution format