Gunderman Corporation has two divisions: the Alpha Division and the Charlie Divi
ID: 2471310 • Letter: G
Question
Gunderman Corporation has two divisions: the Alpha Division and the Charlie Division. The Alpha Division has sales of $305,000, variable expenses of $153,600, and traceable fixed expenses of $70,800. The Charlie Division has sales of $615,000, variable expenses of $337,800, and traceable fixed expenses of $132,700. The total amount of common fixed expenses not traceable to the individual divisions is $134,200. What is the company's net operating income?
Gunderman Corporation has two divisions: the Alpha Division and the Charlie Division. The Alpha Division has sales of $305,000, variable expenses of $153,600, and traceable fixed expenses of $70,800. The Charlie Division has sales of $615,000, variable expenses of $337,800, and traceable fixed expenses of $132,700. The total amount of common fixed expenses not traceable to the individual divisions is $134,200. What is the company's net operating income?
Explanation / Answer
Net Operating Income = Sales - Total Expenses
So, for Gunderman Corporation, Net Operating Income = 305,000 + 615,000 - 153,600 - 70,800 - 337,800 - 132,700 - 134,200 = $90,900
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