Garcia Company has two operating departments (Phone and Earbuds) and one service department (Office). Its departmental income statements follow. Indirect expenses and service department expenses consist of rent, utilities, and office department expenses. Sales Cost of goods sold Gross profit Expenses. Sales salaries Supplies used Depreciation-Equipment GARCIA COMPANY Departmental Income Statements For Year Ended December 31 Phone $ 160,000 78,400 81,600 Rent Utilities Share of office department expenses Total expenses Income 22,000 600 1,400 7,110 2,800 13,000 46,910 $ 34,690 Earbuds $ 95,000 58,900 36,100 7,000 300 300 3,600 1,200 8,000 20,400 $ 15,700 Combined $ 255,000 137,300 117,700 29,000 900 1,700 10,710 4,000 21,000 67,310 $ 50,390

Q: Classify the Costs for Financial Statements?

A: Cost: The amount paid to purchase the asset, install it, and put it into operations, is referred to…

Q: what the difference between accounting income and economic income?

A: Accounting income can be defined as an estimate of the performance in the operations of the company.…

Q: Required information Skip to question [The following information applies to the questions displayed…

A: Segment reporting breaks down the operations of a company into manageable pieces, or segments.…

Q: Distinguish between Income and Expenditure Account and Receiptand Payment Account.

A: Difference between income and expenditure account and receipt and payment account:

Overheads

In cost accounting, overhead refers to those expenses which occur during the operating of a business. Overhead includes the fixed, variable, or semi-variable which is not directly involved with a company product or service. It is very important to analyze overhead expense as it helps the company in determining how much a company must charge for its products and services so that they can generate profit.  Overhead expenses depend upon the nature of the business operations.