I need help with this financial accounting question using the proper accounting approach. A retail business has three divisions: Electronics, Clothing,and Home Goods. The company incurred $60,000 ingeneral advertising expenses for the year, which benefitsall three divisions. The annual sales by division were:•Electronics: $125,000Clothing: $275,000.Home Goods: $200,000If the advertising expense is allocated based on sales.revenue, how much of the advertising cost should beallocated to the Clothing division?

Step 1: Define Advertising ExpenseAdvertising expense refers to the costs incurred by a business to…

Answered: A retail business has three divisions:…

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter10: Cost Analysis For Management Decision Making

Section: Chapter Questions

Problem 18E

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Using the information in the previous exercises about Marleys Manufacturing, determine the operating income for department B, assuming department A sold department B 1,000 units during the month and department A reduces the selling price to the market price.
A hardware store has three departments: A, B, and C, and incurs general advertising expenses that benefit all departments. The total advertising expense for the year is $60,000, and departmental sales are as follows: • Department A: $150,000 • Department B: $240,000 Department C: $180,000 Total Sales: $570,000 Required: Allocate advertising expenses to Department B based on departmental sales.
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Beta Supermarket has three departments: A, B, and C, and conducts general advertising that benefits all departments. The total advertising expense for the year was $55,000, and the departmental sales were as follows: . Department A: $132,500 Department B: $187,250 . Department C: $155,000 Total Sales: $474,750 Allocate the advertising expense to Department B based on departmental sales.
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How much advertising expense should be allocated
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Superior Markets, Incorporated, operates three stores in a large metropolitan area. A segmented absorption costing income statement for the company for the last quarter is given below: Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses Administrative expenses Total expenses Net operating income (loss) Selling expenses: Sales salaries Direct advertising General advertising* Store rent Depreciation of store fixtures Delivery salaries Depreciation of delivery equipment Total selling expenses *Allocated on the basis of sales dollars. Administrative expenses: Store managers' salaries General office salaries* Superior Markets, Incorporated Income Statement For the Quarter Ended September 30 Insurance on fixtures and inventory Utilities Employment taxes General office-other* Total $ 3,000,000 1,657, 200 1,342,800 Total administrative expenses *Allocated on the basis of sales dollars. 817,000 383,000 1,200,000 $ 142,800 a. The breakdown of the selling…
I want to correct answer general accounting question
Macee Department Store has three departments, and it conducts advertising campaigns that benefit all departments. Advertising costs are $126,000 this year, and departmental sales for this year follow. Department Sales $225,000 1 2 3 How much advertising cost is allocated to each department if the allocation is based on departmental sales? 450,000 225,000 Department Sales 1 2 3 Total % of Total Advertising to Allocate Allocated Amount
Bison Creek Company is preparing its annual profit plan. As part of its analysis of the cost of its purchasing activity, management estimates that the $250,000 for purchasing support should be assigned to the individual vendors from the information given as follows: Vendor A Vendor B Vendor C Units purchased 100,000 100,000 500,000 Purchase orders (annual) 12 24 50 Number of shipments received 12 52 100 Required: a. Allocate the purchasing costs to the three vendors, assuming Bison Creek uses units purchased to compute activity-based costs. b. Allocate the purchasing costs to the three vendors, assuming Bison Creek uses purchases orders to compute activity-based costs. c. Allocate the purchasing costs to the three vendors, assuming Bison Creek uses number of shipments to compute activity-based costs.
Bed & Bath, a retailing company, has two departments-Hardware and Linens. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income (loss) Total $ 4,200,000 1,290,000 2,910,000 2,290,000 $ 620,000 Department Linens $ 1,150,000 406,000 Hardware $ 3,050,000 884,000 2,166,000 1,450,000 $ 716,000 744,000 840,000 $ (96,000) A study indicates $374,000 of the fixed expenses being charged to Linens are sunk costs or allocated costs that will continue even if the Linens Department is dropped. In addition, the elimination of the Linens Department will result in a 11% decrease in the sales of the Hardware Department. Required: What is the financial advantage (disadvantage) of discontinuing the Linens Department?

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