Question

Henrietta Ltd. produces fine clothing for women. There are two primary divisions within the company: professional wear and formal wear. The following income statements were prepared for the divisions:


The above income statements were prepared by an inexperienced staff accountant. Common fixed expenses of $50,000 were allocated to the two divisions as follows: 30 percent to professional wear and 70 percent to formal wear.

Required
Prepare new segmented income statements for Henrietta Ltd. after removing the common fixedexpenses.


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  • CreatedMarch 11, 2015
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