a) Determine the divisional income from operations for three regions by allocating the service department expenses proportional to sales of the regions. b) determine the increase or decrease in net income if C region did not operate.
a) Determine the divisional income from operations for three regions by allocating the service department expenses proportional to sales of the regions. b) determine the increase or decrease in net income if C region did not operate.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Using A. Corporation information and data .
a) Determine the divisional income from operations for three regions by allocating the service department expenses proportional to sales of the regions.
b) determine the increase or decrease in net income if C region did not operate.
| A region | B region | C region | ||
| Sales | $ 2,000,000 | $2,800,000 | $3,200,000 | |
| Cost of goods sold | $700,000 | $1,100,000 | $1,900,000 | |
| Selling expenses | $500,000 | $850,000 | $1,000,000 |
Service department expenses
Purchasing 600,000
Payroll accounting. 400,000
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