Wingate Company has the following information available for three divisions of t

Question

Wingate Company has the following information available for three divisions of the company:

                                                                          Division A     Division B     Division C

Sales                                                                      $250,000        $400,000        $350,000

Variable expenses                                                         52%               30%               40%

Fixed expenses controllable by division manager      $60,000        $200,000        $175,000

Fixed expenses controllable by others                       $10,000            $5,000           $7,500

Unallocated expenses for all three divisions are $22,000. What is the contribution by Division A?

A) $28,000

B) $60,000

C) $50,000

D) $120,000

Explanation / Answer

Answer (d) $120,000. (Contribution :- Sales Less Variable Cost {$250,000 - $130,000)

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