Orderly Headquarters,Inc The Company Incurred $1,500 as Fixed Costs

Essay

Orderly Headquarters,Inc.has two business segments: Commercial and Residential.The following data have been provided for the year ending December 31,20XX.
$\begin{array}{lll} & \text { Commercial } & \text { Residential } \\\text { Service Revenue } & \$ 5,900 & \$ 8,500 \\\text { Variable costs } & 3,500 & 5,400\end{array}$ The company incurred $1,500 as fixed costs.
Requirements:
a)Prepare the income statement of Orderly Headquarters showing the contribution margin of each segment.
b)Calculate the contribution margin ratio of each segment.Which segment is more profitable and why?