Using this format, answer the following two questions.

1.		Division
	Total Company	East	Central	West
Sales................................
Variable expenses............
Contribution margin.........
Traceable fixed expenses.
Divisional segment margin..........................
Common fixed expenses not traceable to divisions*......................
Net operating loss............

2. The incremental net operating income is computed as follows:

	Incremental West Division sales ($350,000 20%)..................................................
	Contribution margin ratio ($210,000 $350,000)..........................
	Incremental contribution margin...............
	Less incremental advertising expense........
	Incremental net operating income.............

Yes, the advertising program should be initiated. __?

EXERCISE 6-11 Segmented Income Statement L06-4 Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales ... Variable expenses........... Contribution margin ...... Fixed expenses..... Net operating income (loss)...... $1,000,000 390,000 610,000 625,000 $ (15,000) In an effort to resolve the problem, the company would like to prepare an income gmented by division. Accordingly, the Accounting Department has developed the following information: Division East Central West Sales .......................... Variable expenses as a percentage of sales ......... Traceable fixed expenses ...... $250,000 $400,000 52% $350.000 40% po $200,000 $175,000 30% Required: 1. Prepare a contribution format income statement segmented by divisions. 2. The Marketing Department has proposed increasing the West Division's month by $15.000 based on the belief that it would increase that division's sales by 200 these estimates are accurate, how much would the company's net operating inco, (decrease) if the proposal is implemented? n's monthly advertising les by 20%. Assuming ating income increase