Tubaugh Corporation has two major business segments--East and West. In December, the East business segment had sales revenues of $370,000, variable expenses of $200,000, and traceable fixed expenses of $44,000.

Tubaugh Corporation has two major business segments--East and West. In December, the East business segment had sales revenues of $370,000, variable expenses of $200,000, and traceable fixed expenses of $44,000. During the same month, the West business segment had sales revenues of $1,040,000, variable expenses of $532,000, and traceable fixed expenses of $199,000. The common fixed expenses totaled $306,000 and were allocated as follows: $153,000 to the East business segment and $153,000 to the West business segment.

The contribution margin of the West business segment is:

Multiple Choice

• $508,000

  Correct
• $126,000
• $693,000
• $(27,000)

Explanation

	West
Sales	$	1,040,000
Variable expenses		532,000
Contribution margin		508,000