Do not give answer in image Below are departmental income statements for a guitar manufacturer. The company classifies advertising, rent, and utilities as indirectexpenses. The manufacturer is considering eliminating its Electric Guitar department because it shows a loss.Departmental Income StatementsFor Year Ended December 31SalesCost of goods soldGross profitExpensesAdvertisingDepreciation-EquipmentSalariesSupplies usedRentUtilitiesTotal expensesIncome (loss)Acoustic$ 103,40044,67558,725For Year Ended December 314,99510,15019,700Gross profitDirect expenses1,9307,0552,99546,825$ 11,900Required 1 Required 2Prepare a departmental contribution to overhead report.Departmental Contribution to OverheadTotal direct expensesDepartmental contribution to overhead1. Prepare a departmental contribution to overhead report.2. Based on contribution to overhead, should the electric guitar department be eliminated?Complete this question by entering your answers in the tabs below.Electric$ 84,40047,45036,950Acoustic< Required 14,2608,58017,6001,7805,9802,56040,760$ (3,810)ElectricCombinedRequired 2 >

The contribution margin is calculated as difference between sales and variable costs. The direct…

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. Departmental Income Statements For Year Ended December 31 Sales Cost of goods sold Gross profit Expenses Advertising Depreciation-Equipment Salaries Supplies used Rent 4 Utilities Total expenses Income (loss) Acoustic $ 103,400 44,675 58,725 4,995 10,150 Required 1 Required 2 19,700 1,930 7,055 2,995 46,825 $ 11,900 Electric $ 84,400 47,450 36,950 1. Prepare a departmental contribution to overhead report. 2. Based on contribution to overhead, should the electric guitar department be eliminated? 4,260 8,580 17,600 1,780 5,980 2,560 40,760 $ (3,810) Complete this question by entering your answers in the tabs below. vut

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. Departmental Income Statements For Year Ended December 31 Sales Cost of goods sold Gross profit Expenses Advertising Depreciation-Equipment Salaries Supplies used Rent 4 Utilities Total expenses Income (loss) Acoustic $ 103,400 44,675 58,725 4,995 10,150 Required 1 Required 2 19,700 1,930 7,055 2,995 46,825 $ 11,900 Electric $ 84,400 47,450 36,950 1. Prepare a departmental contribution to overhead report. 2. Based on contribution to overhead, should the electric guitar department be eliminated? 4,260 8,580 17,600 1,780 5,980 2,560 40,760 $ (3,810) Complete this question by entering your answers in the tabs below. vut

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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