Pennington Products
Pennington Products Has Two Product Lines: R-100 and R-200

Pennington Products
Pennington Products has two product lines: R-100 and R-200. Revenue and cost information for each of the product lines are as follows:
$\begin{array}{lrr}&\underline{\text { R-100 }}&\underline{\text { R-200 }}\\\text { Selling price per unit } & \$ 45 & \$ 60 \\\text { Variable costs per unit } & 15 & 24 \\\text { Traceable fixed expenses } & \$ 250000 & \$ 360000\end{array}$

Pennington has common fixed expenses of $250 000 per year. Last year, the company produced and sold 30 000 units of R-100 and 20 000 units of R-200.
-What is the segment margin of the R-100 product line?

A) $650 000
B) $900 000
C) $525 000
D) $400 000

Correct Answer:

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