Flex, Inc., which is headquartered in Hoboken, New Jersey, operates a chain of 125 shoe stores throughout the United States. Consider the costs that appear in the following table, many of which pertain to the company's sole operation in Pottersville, New Jersey:??Performance MeasureCostPottersville Segment Contribution MarginPottersville Controllable ProfitMarginPottersville Segment ProfitMarginFlexNetIncomePottersville property taxes????Sales commissions paid to Pottersville employees????Allocated corporate overhead to individual store sites????Wages of Pottersville hourly employees????Salary of Pottersville manager????Pottersville Cost of Goods Sold????Local advertising handled by Pottersville manager????Flex income tax
expense????Pottersville store maintenance costs????Specify store maintenance as a fixed costs. Adopt the following language. "Pottersville store maintenance costs as agreed upon in yearly maintenance contract negotiated by Pottersville manager."Required: Analyze each of the costs and determine whether the cost affects Pottersville segment contribution margin, controllable profit margin, and segment profit margin, and/or the net income of Flex, Inc. Place an "X" in the appropriate cell(s).
What will be an ideal response?
| ? | ? | Performance Measure | ||
Cost | Pottersville Segment Contribution Margin | Pottersville Controllable Profit Margin | Pottersville Segment Profit Margin | Flex Net Income |
| Pottersville property taxes | ? | ? | X | X |
| Sales commissions paid to Pottersville employees | X | X | X | X |
| Allocated corporate overhead to individual store sites | ? | ? | ? | X |
| Wages of Pottersville hourly employees | X | X | X | X |
| Salary of Pottersville manager | ? | ? | X | X |
| Pottersville Cost of Goods Sold | X | X | X | X |
| Local advertising handled by Pottersville manager | ? | X | X | X |
| Flex income tax expense | ? | ? | ? | X |
| Pottersville store maintenance costs | ? | X | X | X |
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What will be an ideal response?
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