The following information pertains to the Southwest Territory of Sooner Company: $\begin{array}{lr}
\text { Net Sales } & \$ 5,250 \
\text { Variable costs: } & \
\text { Cost of merchandise sold } & 1,200 \
\text { Operating expenses } & 450 \
\text { Fixed costs: } & \
\text { Controllable by segment manager } & 600 \
\text { Controllable by others } & 1,250 \
\text { Unallocated costs } & 1,150
\end{array}$ The contribution controllable by a segment manager is _____.
A)$3,350
B)$3,000
C)$2,500
D)$2,350

Question

Quizplus · Accepted Answer

The contribution controllable by a segment manager is calculated by subtracting the variable costs and the fixed costs that are controllable by the segment manager from the net sales. Here, it's $5,250 (Net Sales) - $1,200 (Cost of merchandise sold) - $450 (Operating expenses) - $600 (Controllable by segment manager) = $3,000.

The Following Information Pertains to the Southwest Territory of Sooner