Reference no: EM132845363
Question - Shaley Company has two divisions and the following information available:
1. Net sales were RM130,000. RM90,000 was attributed to the Jewel Division.
2. Variable costs were RM80,000. 40% was attributed to the Song Division.
3. Total separable fixed costs controllable by division managers were RM30,000, of which RM20,000 applied to the Jewel Division.
4. Total separable fixed costs, not controllable by division managers were RM10,000 in the Jewel Division and RM4,000 in the Song Division.
5. Unallocated costs were RM7,000.
Required -
i. Prepare a contribution approach income statement for the company as a whole and each division.
ii. Explain which division manager should receive a bonus with reason.