Answer Happy

Jackson County Senior Services is a nonprofit organization devoted to providing essential services to seniors who live in their own homes within the Jackson County area. Three services are provided for seniors-home nursing, Meals On Wheels, and housekeeping. Data on revenue and expenses for the past year follow: Revenues Total $ 936,000 475,000 Home Nursing $ 270,000 113,000 Heals On Wheels $ 410,000 205,000 205,000 House- keeping $ 256,000. 157,000 461,000 157,000 Variable expenses Contribution margin Fixed expenses Depreciation 99,000 70,000 8,700 40,500 20,800 Liability insurance 44,300 20,500 7,900 15,900 114,200 40,300 38,600 35,300 Program administrators salaries General administrative overhead Total fixed expenses 187,200 54,000 82,000 51,200 415,700 123.500 169,000 123,200 Net operating income (loss) $ 45,300 $33,500 $36,000 $ (24,200) "Allocated on the basis of program revenues. The head administrator of Jackson County Senior Services, Judith Miyama, considers last year's net operating income of $45,300 to be unsatisfactory; therefore, she is considering the possibility of discontinuing the housekeeping program. The depreciation in housekeeping is for a small van that is used to carry the housekeepers and their equipment from job to job. If the program were discontinued, the van would be donated to a charitable organization. None of the general administrative overhead would be avoided if the housekeeping program were dropped, but the liability insurance and the salary of the program administrator would be avoided.
1-a. What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? 1-b. Based on the financial advantage (disadvantage) of discontinuing the Housekeeping program calculated in requirement Req 1A, should the Housekeeping program be discontinued? 2-a. Prepare a properly formatted segmented income statement. 2-b. Would a segmented income statement format be more useful to management in assessing the long-run financial viability of the various services? Complete this question by entering your answers in the tabs below. Req 1A Req 18 Req 2A Req 28. What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? Req 1B >
Required: 1-a. What is the financial advantage (disadvantage) of discontinuing the Housekeeping program? 1-b. Based on the financial advantage (disadvantage) of discontinuing the Housekeeping program calculated in requirement Req 1A, should the Housekeeping program be discontinued? 2-a. Prepare a properly formatted segmented income statement. 2-b. Would a segmented income statement format be more useful to management in assessing the long-run financial viability of the various services? Complete this question by entering your answers in the tabs below. Req 1A Rec 18 Req 2A Req 2B Based on the financial advantage (disadvantage) of discontinuing the Housekeeping program calculated in requirement Req 1A, should the Housekeeping program be discontinued? Yes <Req 1A Req 2A > ONO
Req 1A Req 18 Reg 2A Req 28 Prepare a properly formatted segmented income statement. Total Revenues Variable expenses Contribution margin Traceable fixed expenses: Depreciation Liability insurance Program administrators' salaries Total traceable fixed expenses Program segment margins General administrative overhead Net operating income (loss), <Roq 1B Home Nursing Meals On Wheels Req 28 House- keeping
2-b. Would a segmented income statement format be more useful to management in assessing the long-run financial viability of the various services? Complete this question by entering your answers in the tabs below. Req 1A Reg 18 Req 2A Req 28 Would a segmented income statement format be more useful to management in assessing the long-run financial viability of the various services? Yes No Req 2A