Module 4 – SLP RESPONSIBILITY ACCOUNTING FOR COST, PROFIT AND INVESTMENT CENTERS
The following data pertain to the operating revenues and expenses for California, Inc. for 20XX.
| Los Angeles(LA) Segment | San Francisco(SF) Segment | Total | |
| Sales | $180,000 | $360,000 | $540,000 |
| Variable expenses | 96,000 | 240,000 | 336,000 |
| Direct fixed expenses | 24,000 | 30,000 | 54,000 |
| Indirect fixed expenses | 72,000 |
Assets (investment) used to generate operating income for the two segments are shown below.
| Los AngelesSegment | San FranciscoSegment | |
| Assets directly used by and identified with the segment | $180,000 | $360,000 |
- Prepare a segmented income statement in good format showing the contribution margin of each segment, the contribution to indirect expenses of each segment, and the total income of California, Inc.
- Determine the return on investment for evaluating (1) the earning power of the entire company and (2) the performance of each segment.
- Comment on the results of part (b).
SLP Assignment Expectations
Show computations in good format and explain answers as required. Excel is a great tool to make computations and present financial information in an easy to understand format. Write comments below the computations in Excel. Submit only the Excel file. Both content and the clarity of the presentation will be evaluated for grading purposes.
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