General Accounting Marian Corporation has two separate divisions that operate as profit centers.The following information is available for the most recent year:Black Division Navy DivisionSales (net)Salary expense$800,00027,000Cost of goods sold 100,000$390,00047,000158,000The Black Division occupies 19,000 square feet in the plant. The Navy Divisionoccupies 29,000 square feet. Rent is an indirect expense and is allocatedbased on square footage. Rent expense for the year was $49,000.Compute gross profit for the Black and Navy Divisions, respectively.

Step 1: Gross Profit is calculated by subtracting the cost of goods sold from the Net Sales. Step…

Answered: Marian Corporation has two separate…

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter25: Departmental Accounting

Section: Chapter Questions

Problem 1CE

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Arlington Clothing, Inc., shows the following information for its two divisions for year 1. Lake Region Coastal Region Sales revenue $ 4,160,000 $ 13,070,000 Cost of sales 2,691,300 6,535,000 Allocated corporate overhead 249,600 784,200 Other general and administration 553,900 3,755,000 Required: a. Compute divisional operating income for the two divisions. Ignore taxes. b-1. What are the gross margin and operating margin percentages for both divisions? b-2. How well have these divisions performed?
Rundle Transport Company divides its operations into four divisions. A recent income statement for its West Division follows. RUNDLE TRANSPORT COMPANY West Division Income Statement for Year 3 Revenue $ 620,000 Salaries for drivers (470,000 ) Fuel expenses (62,000 ) Insurance (82,000 ) Division-level facility-sustaining costs (52,000 ) Companywide facility-sustaining costs (142,000 ) Net loss $ (188,000 ) Required By how much would companywide income increase or decrease if West Division is eliminated? Should West Division be eliminated? Assume that West Division is able to increase its revenue to $690,000 by raising its prices. Determine the amount of the increase or decrease that would occur in companywide net income if the segment were eliminated. Should West Division be eliminated if revenue were $690,000? What is the minimum amount of revenue required to justify continuing the operation of West Division?
Vernon transport company divides its operations into four divisions. A recent statement for its West Division folows Vernon Transport Comapny Wesy division Income Statement for year 3 Revenue $670,000 Salaries for drivers (520,000) Fuel expenses (67,000) Insurance (87,000) Division-level facility- sustaining costs (57,000) Companywide facility-sustaining costs (147,000) Net loss $208,000 Required a) By how much would cormpanywide income increase or decrease if West Division is estimated? Should West Division be eliminated? b) assume that West Division is able to increase its revenue to $760,000 by raising its prices. Determine the amount of the increase or decrease that would occur in companywide net income if the segemnt were eliminated. Should West Division be eliminated if revenue were $760,000? c) What is the mininum amount of revenue required to Jusify continuing the operation of West Divison? Complete this question by entering your answer in the table below. Income Would…
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Clouthier Corporation has two divisions: Home Division and Commercial Division. The following report is for the most recent operating period: Total Company Home Division Commercial Division Sales $ 572, 000 $ 268, 000 $ 304, 000 Variable expenses $ 205, 790 $ 88, 360 $ 117, 430 Traceable fixed expenses $ 203, 000 $ 91, 000 $ 112, 000 The company's common fixed expenses total $62, 700. Required: What is the Home Division's break - even in sales dollars? What is the Commercial Division's break - even in sales dollars? What is the company's overall break - even in sales dollars? Note: Round intermediate calculations to three decimal places.
Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of office expenses are allocated to the two operating departments using different allocation bases. The following information is available for the current period: Office Expenses Total Allocation Base Salaries $ 30,000 Number of employees Depreciation 20,000 Cost of goods sold Advertising 40,000 Percentage of total sales Department Number of employees Sales Cost of goods sold Drilling 1,000 $ 325,000 $ 75,000 Grinding 1,500 475,000 125,000 Total 2,500 $ 800,000 $ 200,000 The amount of salaries that should be allocated to Grinding for the current period is:
Ultimo Company operates three production departments as profit centers. The following Information is avallable tor its most recent year Depntment 2s comciodn to o n dollars is: Sales Department 1 $ 3,500,000 Department 2 $ 1,400,000 Cost of Department 3 goods sold 2,450,000 $ 2,450,0o0 Direct expenses 525,000 1,050,000 Indirect expenses 350,000 140,000 525,000 280,000 350,000 70,000 Multiple Choice $735,000. $525,000. $35,000. $910,000. 10 of 25 no. ( Prev
Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of office expenses are allocated to the two operating departments using different allocation bases. The following information is available for the current period: Office Expenses Salaries Total Allocation Basis Number of employees $ 40,000 Depreciation Advertising 26,000 60,000 Cost of goods sold Percentage of total sales Department Number of employees Drilling Grinding 1,800 2,700 Sales $ 352,000 528,000 Cost of goods sold $ 110,200 179,800 Total 4,500 $ 880,000 $ 290,000 The amount of the advertising cost that should be allocated to Grinding for the current period is:
Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of office expenses are allocated to the two operating departments using different allocation bases. The following information is available for the current period: Office Expenses Salaries Depreciation Advertising Department Drilling Grinding Total Total $ 38,000 24,000 52,000 Number of employees 1,640 2,460 4,100 Allocation Basis Number of employees Cost of goods sold Percentage of total sales Sales $338,000 494,000 $832,000 Cost of goods sold $87,000 145,000 $232,000 The amount of the total office expenses that should be allocated to Grinding for the current period is (Do not round your intermediate calculations.)
Zachary Transport Company divides its operations into four divisions. A recent income statement for its West Division follows. ZACHARY TRANSPORT COMPANY West Division Income Statement for Year 3 Revenue $ 690,000 (540,000) (69,000) (89,000) (59,000) (149,000) Salaries for drivers Fuel expenses Insurance Division-level facility-sustaining costs Companywide facility-sustaining costs Net loss $(216,000) Required a. By how much would companywide income increase or decrease if West Division is eliminated? Should West Division be eliminated? b. Assume that West Division is able to increase its revenue to $780,000 by raising its prices. Determine the amount of the increase or decrease that would occur in companywide net income if the segment were eliminated. Should West Division be eliminated if revenue were $780,000? c. What is the minimurn amount of revenue required to justify continuing the operation of West Division? Complete this question by entering your answers in the tabs below.…
Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of office expenses are allocated to the two operating departments using different allocation bases. The following information is available for the current period: Office Expenses Total Allocation Basis Salaries $39,000 Number of employees Depreciation 29,000 Cost of goods sold Advertising 68,000 Percentage of total sales Department Number of employees Sales Cost of goods sold Drilling 1,800 $368,000 $ 121,600 Grinding 2,700 552,000 198,400 Total 4,500 $920,000 $320,000 The amount of the advertising cost that should be allocated to Drilling for the current period is: Multiple Choice $27,200. $82,600. $40,800. $368,000. $86,200. A company produced 195 units of Product L and 182 units of Product M during the current period and incurred joint costs of $900. Product L sells for $8 per unit and Product M sells for $20 per unit. Compute the cost to be allocated to Product M for this…

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