Contribution margin ratio and net operating income

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Reference no: EM13753178

Michaels Company segments its income statement into its East and West Divisions. The company’s overall sales, contribution margin ratio, and net operating income are $640,000, 60%, and $64,000, respectively. The West Division’s contribution margin and contribution margin ratio are $195,000 and 75%, respectively. The East Division’s segment margin is $54,000. The company has $76,800 of common fixed costs that cannot be traced to either division.

Required: Prepare an income statement for Michaels Company that uses the contribution format and is segmented by division.

Reference no: EM13753178

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