Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operating income in percentage, analyze the following financial information to determine costs that may need further investigation.Marley's ManufacturingIncome StatementMonth Ending August 31, 2018 Dept. ADept. BSales$23,000 $50,000 Cost of goods sold11,270 25,500 Gross profit$11,730 $24,500 Expenses: Utility expenses$1,380 $3,000 Wages expense5,520 10,000 Costs allocated from corporate2,070 14,000 Total expenses$8,970 $27,000 Operating income/(loss) in dollars$fill in the blank 1 $fill in the blank 2 Operating income/(loss) in percentagefill in the blank 3%fill in the blank 4%

Dept A ($) Dept B ($) Sales 23000 50000 Cost of the goods sold 11270 25500 Gross profit…

Answered: Assume you are the department B manager…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operating income in percentage, analyze the following financial information to determine costs that may need further investigation.

Marley's Manufacturing Income Statement Month Ending August 31, 2018
	Dept. A	Dept. B
Sales	$23,000		$50,000
Cost of goods sold	11,270		25,500
Gross profit	$11,730		$24,500
Expenses:
Utility expenses	$1,380		$3,000
Wages expense	5,520		10,000
Costs allocated from corporate	2,070		14,000
Total expenses	$8,970		$27,000
Operating income/(loss) in dollars	$fill in the blank 1		$fill in the blank 2
Operating income/(loss) in percentage	fill in the blank 3	%	fill in the blank 4	%

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