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Below are departmental income statements for a guitar manufacturer. The company classifies advertising, rent, and utilities as indirect expenses. The manufacturer is considering eliminating its Electric Guitar department because it shows a loss. For Year Ended December 31 Sales Cost of goods sold Gross profit Expenses Advertising Departmental Income Statements Depreciation-Equipment Salaries Supplies used Rent Utilities Total expenses Income (loss) Acoustic $ 103,100 43,975 59,125 5,025 10,080 19,500 1,980 7,045 3,025 46,655 $ 12,470 Electric $ 85,000 47,650 37,350 4,310 8,570 17,700 1,720 5,980 2,620 40,900 $ (3,550) 1. Prepare a departmental contribution to overhead report. 2. Based on contribution to overhead, should the electric guitar department be eliminated? Answer is not complete. Complete this question by entering your answers in the tabs below.

Below are departmental income statements for a guitar manufacturer. The company classifies advertising, rent, and utilities as indirect expenses. The manufacturer is considering eliminating its Electric Guitar department because it shows a loss. For Year Ended December 31 Sales Cost of goods sold Gross profit Expenses Advertising Departmental Income Statements Depreciation-Equipment Salaries Supplies used Rent Utilities Total expenses Income (loss) Acoustic $ 103,100 43,975 59,125 5,025 10,080 19,500 1,980 7,045 3,025 46,655 $ 12,470 Electric $ 85,000 47,650 37,350 4,310 8,570 17,700 1,720 5,980 2,620 40,900 $ (3,550) 1. Prepare a departmental contribution to overhead report. 2. Based on contribution to overhead, should the electric guitar department be eliminated? Answer is not complete. Complete this question by entering your answers in the tabs below.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a departmental contribution to overhead report. Departmental Contribution to Overhead Acoustic For Year Ended December 31 Gross profit Direct expenses Total direct expenses Departmental contribution to overhead S 0 0 Electric < Required 1 0 0 Combined 0 0 Required 2 >
Transcribed Image Text:Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a departmental contribution to overhead report. Departmental Contribution to Overhead Acoustic For Year Ended December 31 Gross profit Direct expenses Total direct expenses Departmental contribution to overhead S 0 0 Electric < Required 1 0 0 Combined 0 0 Required 2 >
Below are departmental income statements for a guitar manufacturer. The company classifies advertising, rent, and utilities as indirect expenses. The manufacturer is considering eliminating its Electric Guitar department because it shows a loss. For Year Ended December 31 Sales Cost of goods sold Gross profit Expenses Advertising Departmental Income Statements Depreciation-Equipment Salaries Supplies used Rent Utilities Total expenses Income (loss) Acoustic $ 103,100 43,975 59,125 5,025 10,080 19,500 1,980 7,045 3,025 46,655 $ 12,470 Electric $ 85,000 47,650 37,350 4,310 8,570 17,700 1,720 5,980 2,620 40,900 $ (3,550) 1. Prepare a departmental contribution to overhead report. 2. Based on contribution to overhead, should the electric guitar department be eliminated? Answer is not complete. Complete this question by entering your answers in the tabs below.
Transcribed Image Text:Below are departmental income statements for a guitar manufacturer. The company classifies advertising, rent, and utilities as indirect expenses. The manufacturer is considering eliminating its Electric Guitar department because it shows a loss. For Year Ended December 31 Sales Cost of goods sold Gross profit Expenses Advertising Departmental Income Statements Depreciation-Equipment Salaries Supplies used Rent Utilities Total expenses Income (loss) Acoustic $ 103,100 43,975 59,125 5,025 10,080 19,500 1,980 7,045 3,025 46,655 $ 12,470 Electric $ 85,000 47,650 37,350 4,310 8,570 17,700 1,720 5,980 2,620 40,900 $ (3,550) 1. Prepare a departmental contribution to overhead report. 2. Based on contribution to overhead, should the electric guitar department be eliminated? Answer is not complete. Complete this question by entering your answers in the tabs below.
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