The Rial Company’s income statement for June is given below:…

The Rial Company’s income statement for June is given
below:

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150. If sales for Division F increase $40,000 with a
$10,000 increase in the Division’s traceable fixed costs, the overall company
net operating income should:
A. increase by $30,000
B. increase by $6,000
C. increase by $2,889
D. decrease by $4,000

151. During June, the sales clerks in Division F
received salaries totaling $35,000. Assume that during July the salaries of
these sales clerks are discontinued and instead they are paid a commission of
18% of sales. If sales in Division F increase by $65,000 as a result of this
change, the July segment margin for Division F should be:
A. $42,700
B. $19,400
C. $54,400
D. $94,000

152. If the sales in Division L increase by 30% while
common fixed expenses in the company decrease by $10,000, the segment margin
for Division L should:
A. increase by $32,400
B. increase by $10,800
C. decrease by $22,400
D. decrease by $65,600

153. A proposal has been made that will lower variable
expenses in Division L to 35% of sales. However, this reduction can only be
accomplished by a $15,000 increase in Division L’s traceable fixed expenses. If
this proposal is implemented and if sales remain constant, overall company net
operating income should:
A. increase by $15,000
B. increase by $24,000
C. decrease by $15,000
D. decrease by $6,000

Pong Incorporated’s income statement for the most
recent month is given below.

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154. If Store G sales increase by $40,000 with no
change in fixed costs, the overall company net operating income should:
A. increase by $4,000
B. increase by $8,000
C. increase by $24,000
D. increase by $20,000

155. The marketing department believes that a
promotional campaign for Store H costing $8,000 will increase the store’s sales
by $15,000. If the campaign is adopted, overall company net operating income
should:
A. decrease by $5,000
B. decrease by $5,500
C. increase by $2,000
D. increase by $7,000

Ring, Incorporated’s income statement for the most
recent month is given below.

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For each of the following questions, refer back to the original data.

156. If Store Q sales increase by $30,000 with no
change in fixed expenses, the overall company net operating income
should:
A. increase by $3,750
B. increase by $7,500
C. increase by $12,000
D. increase by $18,000

157. The marketing department believes that a
promotional campaign at Store P costing $5,000 will increase sales by $15,000.
If the campaign is adopted, overall company net operating income should:
A. decrease by $800
B. decrease by $5,800
C. increase by $5,800
D. increase by $10,000

158. A proposal has been made that will lower variable
costs in Store P to 65% of sales. However, this reduction can only be
accomplished by a $16,000 increase in Store P’s traceable fixed costs. If this
proposal is implemented and sales remain constant, overall company net
operating income should:
A. remain the same
B. decrease by $2,000
C. increase by $2,000
D. increase by $14,000

159. If sales in Store Q increase by $30,000 as a result
of a $7,000 increase in traceable fixed costs:
A. Store Q’s contribution margin should increase by $18,000
B. Store Q’s segment margin should increase by $12,000
C. Store Q’s contribution margin should increase by $11,000
D. Store Q’s segment margin should increase by $5,000

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