The Pletcher Transportation Company uses a responsibility reporting system to me

Question

The Pletcher Transportation Company uses a responsibility reporting system to measure the performance of its three investment centers: Planes, Taxis, and Limos. Segment performance is measured using a system of responsibility reports and return on investment calculations. The allocation of resources within the company and the segment managers' bonuses are based in part on the results shown in these reports. Recently, the company was the victim of a computer virus that deleted portions of the company's accounting records. This was discovered when the current period's responsibility reports were being prepared. The printout of the actual operating results appeared as follows. Determine the missing pieces of information below.

Explanation / Answer

Planes Controllable Margin = Average Operating Assets* Return on Investments = 24997600*14 3499664 Contribution Margin = Controllable Fixed Cost+ Controllable Margin 1495000+499664 1994664 Service Revenue = Contribution Margin+ Variable Costs = 1994664+5502500 = 7497164 Taxis Variable Costs = Service Revenue- Contribution Margin = 503700-249700 = 254000 Controllable Fixed Costs = Contribution- Controllable = 249700-80100 = 169600 Average Operating Assets = 80100/.12 667500 Limos Servioce revenue = 299600+449344 = 748944 Controllable Fixed Costs = 449344-207144 242200

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.