Question: Please answer parts 1a AND 2a Jackson County Senior Services is a nonprofit organization devoted to providing essential services to seniors who live in their
Please answer parts 1a AND 2a 
Jackson County Senior Services is a nonprofit organization devoted to providing essential services to seniors who live in their own homes within the Jackson County area. Three services are provided for seniors-home nursing, Meals On Wheels, and housekeeping Data on revenue and expenses for the past year follow: Home Meals On House- Total Nursing Wheels keeping $ 921,000 $261,000 $ 401,000 $ 259,000 485,000 118,000 208,000 159,000 436,000 143,000 193,000 100,000 Revenues Variable expenses Contribution margin Fixed expenses: Depreciation Liability insurance Program administrators' salaries General administrative overhead* Total fixed expenses Net operating income (loss) 70,000 8,400 40, 700 20,900 43,000 20,300 7,600 15,100 115,300 40, 700 38,000 36,600 184,200 52,200 80,200 51,800 412,500 121,600 166,500 124,400 $ 23,500 $ 21,400 $ 26,500 $(24,400) *Allocated on the basis of program revenues. The head administrator of Jackson County Senior Services, Judith Miyama, considers last year's net operating income of $23,500 to be unsatisfactory; therefore, she is considering the possibility of discontinuing the housekeeping program. The depreciation in housekeeping is for a small van that is used to carry the housekeepers and their equipment from job to job. If the program were discontinued, the van would be donated to a charitable organization. None of the general administrative overhead would be avoided if the housekeeping program were dropped, but the liability insurance and the salary of the program administrator would be avoided. Required: 1-a. What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? 1-b. Should the Housekeeping program be discontinued? 2-a. Prepare a properly formatted segmented income statement. 2-b. Would a segmented income statement format be more useful to management in assessing the long-run financial viability of the various services
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
