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Office Total Company Chicago ...

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Accounting

Office
Total Company Chicago Minneapolis
Sales $ 562,500 100.0 % $ 112,500 100 % $ 450,000 100 %
Variable expenses 303,750 54.0 % 33,750 30 % 270,000 60 %
Contribution margin 258,750 46.0 % 78,750 70 % 180,000 40 %
Traceable fixed expenses 126,000 22.4 % 58,500 52 % 67,500 15 %
Office segment margin 132,750 23.6 % $ 20,250 18 % $ 112,500 25 %
Common fixed expenses not traceable to offices 90,000 16.0 %
Net operating income $ 42,750 7.6 %
2. By how much would the companys net operating income increase if Minneapolis increased its sales by $56,250 per year? Assume no change in cost behavior patterns.

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