(Solved by Humans)-Problem 47 Simon Hinson Company operates two divisions: Gordon and Ronin. A segmented income sta

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Problem 47 Simon Hinson Company operates two divisions: Gordon and Ronin. A segmented income statement for the company’s most recent year is as follow: Total Company Gordon Division Ronin Division Sales $850,000 $250,000 $600,000 Less variable expense 505,000 145,000 360,000 Contribution margin $345,000 $105,000 $240,000 Less traceable fixed costs 145,000 45,000 100,000 Division segment margin $200,000 $60,000 $140,000 Less common fixed cost 130,000 Net income $70,000 Required: A. If the Gordon Division increased its sales by $85,000 per year, how much would the company’s net income change? Assume that all cost behavior patterns remained constant. B. Assume that the Ronin Division increased sales by $100,000, the Gorgon Division sales remained the same, and there was no change in fixed costs. 1. Calculate the net income amounts for each division and the total company. 2. Calculate the segment margin ratios before and after these changes and comment on the results. Explain the changes. C. How do the sales increases and decreases impact divisional contribution marhin ratio and segment margin ratio?