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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 Rent Utilities Share of office department expenses Total expenses Income GARCIA COMPANY Departmental Income Statements For Year Ended December 31 Phone $ 220,000 107,800 112, 200 Gross profit Direct expenses Required: Prepare a departmental contribution to overhead report. 22,500 950 1,500 7,840 2,900 13,000 47,890 $ 64,310 Garcia Company Departmental Contribution to Overhead For Year Ended December 31 Phone Total direct expenses Departmental contribution to overhead Earbuds $ 85,000 52,700 32,300 7,500 750 708 3,840 2,500 6,508 21,790 $ 10,510 Earbuds Combined Combined $ 305,000 160,500 144,500 30,000 1,700 2,200 10,880 5,400 19,500 69,688 $ 74,828

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 Rent Utilities Share of office department expenses Total expenses Income GARCIA COMPANY Departmental Income Statements For Year Ended December 31 Phone $ 220,000 107,800 112, 200 Gross profit Direct expenses Required: Prepare a departmental contribution to overhead report. 22,500 950 1,500 7,840 2,900 13,000 47,890 $ 64,310 Garcia Company Departmental Contribution to Overhead For Year Ended December 31 Phone Total direct expenses Departmental contribution to overhead Earbuds $ 85,000 52,700 32,300 7,500 750 708 3,840 2,500 6,508 21,790 $ 10,510 Earbuds Combined Combined $ 305,000 160,500 144,500 30,000 1,700 2,200 10,880 5,400 19,500 69,688 $ 74,828

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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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 Rent Utilities Share of office department expenses Total expenses Income GARCIA COMPANY Departmental Income Statements For Year Ended December 31 Phone $ 220,000 107,800 112, 200 Gross profit Direct expenses Required: Prepare a departmental contribution to overhead report. Garcia Company Departmental Contribution to Overhead For Year Ended December 31 Total direct expenses Departmental contribution to overhead 1,500 7,040 2,900 13,000 47,890 $ 64,310 Phone 22,500 950 Earbuds Earbuds $ 85,000 52,700 32,300 7,500 750 708 3,840 2,500 6,508 21,790 $ 10,510 Combined Combined $ 305,000 160,500 144,500 30,000 1,700 2,200 10,880 5,400 19,500 69,680 $ 74,820
Transcribed Image Text: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 Rent Utilities Share of office department expenses Total expenses Income GARCIA COMPANY Departmental Income Statements For Year Ended December 31 Phone $ 220,000 107,800 112, 200 Gross profit Direct expenses Required: Prepare a departmental contribution to overhead report. Garcia Company Departmental Contribution to Overhead For Year Ended December 31 Total direct expenses Departmental contribution to overhead 1,500 7,040 2,900 13,000 47,890 $ 64,310 Phone 22,500 950 Earbuds Earbuds $ 85,000 52,700 32,300 7,500 750 708 3,840 2,500 6,508 21,790 $ 10,510 Combined Combined $ 305,000 160,500 144,500 30,000 1,700 2,200 10,880 5,400 19,500 69,680 $ 74,820
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