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Cervetti Corporation has two major business segments-East and West. In July, the East business segment had sales revenues of $330,000, variable expenses of $180,000, and traceable fixed expenses of $40,000. During the same month, the West business segment had sales revenues of $1,000,000, variable expenses of $516,000, and traceable fixed expenses of $191,000. The common fixed expenses totaled $290,000 and were allocated as follows: $145,000 to the East business segment and $145,000 to the West business segment.

A properly constructed segmented income statement in a contribution format would show that the segment margin of the East business segment is:

$(5,000)

$180,000

$(43,000)

$110,000

Cervetti Corporation has two major business segments-East and West. In July, the East business segment had sales revenues of $330,000, variable expenses of $180,000, and traceable fixed expenses of $40,000. During the same month, the West business segment had sales revenues of $1,000,000, variable expenses of $516,000, and traceable fixed expenses of $191,000. The common fixed expenses totaled $290,000 and were allocated as follows: $145,000 to the East business segment and $145,000 to the West business segment. A properly constructed segmented income statement in a contribution format would show that the segment margin of the East business segment is: $(5,000) $180,000 $(43,000) $110,000

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