Glades Sporting Goods Co. operates two divisions—the Winter Sports Division and the Summer Sports Division. The following income and expense accounts were provided from the trial balance as of December 31, 20Y8, the end of the fiscal year, after all adjustments, including those for inventories, were recorded and posted:Sales—Winter Sports Division$33,600,000Sales—Summer Sports Division37,120,000Cost of Goods Sold—Winter Sports Division20,160,000Cost of Goods Sold—Summer Sports Division21,440,000Sales Expense—Winter Sports Division5,760,000Sales Expense—Summer Sports Division5,120,000Administrative Expense—Winter Sports Division3,360,000Administrative Expense—Summer Sports Division3,296,000Advertising Expense1,037,000Transportation Expense503,200Accounts Receivable Collection Expense198,800Warehouse Expense3,200,000The bases to be used in allocating expenses, together with other essential information, are as follows:Advertising expense—incurred at headquarters, allocated to divisions on the basis of usage: Winter Sports Division, $487,000; Summer Sports Division, $550,000.Transportation expense—allocated to divisions at an allocation rate of $17 per bill of lading: Winter Sports Division, 14,100 bills of lading; Summer Sports Division, 15,500 bills of lading.Accounts receivable collection expense—incurred at headquarters, allocated to divisions at an allocation rate of $7 per invoice: Winter Sports Division, 13,100 sales invoices; Summer Sports Division, 15,300 sales invoices.Warehouse expense—allocated to divisions on the basis of floor space used in storing division products: Winter Sports Division, 180,000 square feet; Summer Sports Division, 220,000 square feet.Prepare a divisional income statement with two column headings: Winter Sports Division and Summer Sports Division. Do not round your interim calculations.Glades Sporting Goods Co.Divisional Income StatementsFor the Year Ended December 31, 20Y8 Winter SportsDivisionSummer SportsDivisionSales$fill in the blank de6864fce06efc4_1$fill in the blank de6864fce06efc4_2Cost of goods soldfill in the blank de6864fce06efc4_3fill in the blank de6864fce06efc4_4Gross profit$fill in the blank de6864fce06efc4_5$fill in the blank de6864fce06efc4_6Divisional selling and administrative expenses: Divisional selling expenses$fill in the blank de6864fce06efc4_7$fill in the blank de6864fce06efc4_8Divisional administrative expensesfill in the blank de6864fce06efc4_9fill in the blank de6864fce06efc4_10Total divisional selling and administrative expenses$fill in the blank de6864fce06efc4_11$fill in the blank de6864fce06efc4_12Income from operations before service department allocations$fill in the blank de6864fce06efc4_13$fill in the blank de6864fce06efc4_14Less service department cost allocations: Advertising expense$fill in the blank de6864fce06efc4_15$fill in the blank de6864fce06efc4_16Transportation expensefill in the blank de6864fce06efc4_17fill in the blank de6864fce06efc4_18Accounts receivable collection expensefill in the blank de6864fce06efc4_19fill in the blank de6864fce06efc4_20Warehouse expensefill in the blank de6864fce06efc4_21fill in the blank de6864fce06efc4_22Total$fill in the blank de6864fce06efc4_23$fill in the blank de6864fce06efc4_24Income from operations$fill in the blank de6864fce06efc4_25$fill in the blank de6864fce06efc4_26Provide supporting schedules for determining service department cost allocations.. If required, round per unit amounts to two decimal places and final answers to the nearest dollar.Glades Sporting Goods Co.Service Department ChargesFor the Year Ended December 31, 20Y8 Winter SportsDivisionSummer SportsDivisionTotalAdvertising expense$fill in the blank 6cc69f00dfe505b_1$fill in the blank 6cc69f00dfe505b_2$fill in the blank 6cc69f00dfe505b_3Transportation rate per bill of lading$fill in the blank 6cc69f00dfe505b_4$fill in the blank 6cc69f00dfe505b_5 Number of bills of ladingfill in the blank 6cc69f00dfe505b_6fill in the blank 6cc69f00dfe505b_7 Transportation expense$fill in the blank 6cc69f00dfe505b_8$fill in the blank 6cc69f00dfe505b_9$fill in the blank 6cc69f00dfe505b_10Accounts receivable collection rate$fill in the blank 6cc69f00dfe505b_11$fill in the blank 6cc69f00dfe505b_12 Number of sales invoicesfill in the blank 6cc69f00dfe505b_13fill in the blank 6cc69f00dfe505b_14 Accounts receivable collection expense$fill in the blank 6cc69f00dfe505b_15$fill in the blank 6cc69f00dfe505b_16$fill in the blank 6cc69f00dfe505b_17Warehouse rate per sq. ft.$fill in the blank 6cc69f00dfe505b_18$fill in the blank 6cc69f00dfe505b_19 Number of square feetfill in the blank 6cc69f00dfe505b_20fill in the blank 6cc69f00dfe505b_21 Warehouse expense$fill in the blank 6cc69f00dfe505b_22$fill in the blank 6cc69f00dfe505b_23$fill in the blank 6cc69f00dfe505b_24Check My Work

Out of the Three major Financial Statements, Income statement is the one which reports the Financial…

Answered: Prepare a divisional income statement…

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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Glades Sporting Goods Co. operates two divisions—the Winter Sports Division and the Summer Sports Division. The following income and expense accounts were provided from the trial balance as of December 31, 20Y8, the end of the fiscal year, after all adjustments, including those for inventories, were recorded and posted:

Sales—Winter Sports Division	$33,600,000
Sales—Summer Sports Division	37,120,000
Cost of Goods Sold—Winter Sports Division	20,160,000
Cost of Goods Sold—Summer Sports Division	21,440,000
Sales Expense—Winter Sports Division	5,760,000
Sales Expense—Summer Sports Division	5,120,000
Administrative Expense—Winter Sports Division	3,360,000
Administrative Expense—Summer Sports Division	3,296,000
Advertising Expense	1,037,000
Transportation Expense	503,200
Accounts Receivable Collection Expense	198,800
Warehouse Expense	3,200,000

The bases to be used in allocating expenses, together with other essential information, are as follows:

Advertising expense—incurred at headquarters, allocated to divisions on the basis of usage: Winter Sports Division, $487,000; Summer Sports Division, $550,000.
Transportation expense—allocated to divisions at an allocation rate of $17 per bill of lading: Winter Sports Division, 14,100 bills of lading; Summer Sports Division, 15,500 bills of lading.
Accounts receivable collection expense—incurred at headquarters, allocated to divisions at an allocation rate of $7 per invoice: Winter Sports Division, 13,100 sales invoices; Summer Sports Division, 15,300 sales invoices.
Warehouse expense—allocated to divisions on the basis of floor space used in storing division products: Winter Sports Division, 180,000 square feet; Summer Sports Division, 220,000 square feet.

Prepare a divisional income statement with two column headings: Winter Sports Division and Summer Sports Division. Do not round your interim calculations.

Glades Sporting Goods Co.
Divisional Income Statements
For the Year Ended December 31, 20Y8
	Winter Sports Division	Summer Sports Division
Sales	$fill in the blank de6864fce06efc4_1	$fill in the blank de6864fce06efc4_2
Cost of goods sold	fill in the blank de6864fce06efc4_3	fill in the blank de6864fce06efc4_4
Gross profit	$fill in the blank de6864fce06efc4_5	$fill in the blank de6864fce06efc4_6
Divisional selling and administrative expenses:
Divisional selling expenses	$fill in the blank de6864fce06efc4_7	$fill in the blank de6864fce06efc4_8
Divisional administrative expenses	fill in the blank de6864fce06efc4_9	fill in the blank de6864fce06efc4_10
Total divisional selling and administrative expenses	$fill in the blank de6864fce06efc4_11	$fill in the blank de6864fce06efc4_12
Income from operations before service department allocations	$fill in the blank de6864fce06efc4_13	$fill in the blank de6864fce06efc4_14
Less service department cost allocations:
Advertising expense	$fill in the blank de6864fce06efc4_15	$fill in the blank de6864fce06efc4_16
Transportation expense	fill in the blank de6864fce06efc4_17	fill in the blank de6864fce06efc4_18
Accounts receivable collection expense	fill in the blank de6864fce06efc4_19	fill in the blank de6864fce06efc4_20
Warehouse expense	fill in the blank de6864fce06efc4_21	fill in the blank de6864fce06efc4_22
Total	$fill in the blank de6864fce06efc4_23	$fill in the blank de6864fce06efc4_24
Income from operations	$fill in the blank de6864fce06efc4_25	$fill in the blank de6864fce06efc4_26

Provide supporting schedules for determining service department cost allocations.. If required, round per unit amounts to two decimal places and final answers to the nearest dollar.

Glades Sporting Goods Co.
Service Department Charges
For the Year Ended December 31, 20Y8
	Winter Sports Division	Summer Sports Division	Total
Advertising expense	$fill in the blank 6cc69f00dfe505b_1	$fill in the blank 6cc69f00dfe505b_2	$fill in the blank 6cc69f00dfe505b_3
Transportation rate per bill of lading	$fill in the blank 6cc69f00dfe505b_4	$fill in the blank 6cc69f00dfe505b_5
Number of bills of lading	fill in the blank 6cc69f00dfe505b_6	fill in the blank 6cc69f00dfe505b_7
Transportation expense	$fill in the blank 6cc69f00dfe505b_8	$fill in the blank 6cc69f00dfe505b_9	$fill in the blank 6cc69f00dfe505b_10
Accounts receivable collection rate	$fill in the blank 6cc69f00dfe505b_11	$fill in the blank 6cc69f00dfe505b_12
Number of sales invoices	fill in the blank 6cc69f00dfe505b_13	fill in the blank 6cc69f00dfe505b_14
Accounts receivable collection expense	$fill in the blank 6cc69f00dfe505b_15	$fill in the blank 6cc69f00dfe505b_16	$fill in the blank 6cc69f00dfe505b_17
Warehouse rate per sq. ft.	$fill in the blank 6cc69f00dfe505b_18	$fill in the blank 6cc69f00dfe505b_19
Number of square feet	fill in the blank 6cc69f00dfe505b_20	fill in the blank 6cc69f00dfe505b_21
Warehouse expense	$fill in the blank 6cc69f00dfe505b_22	$fill in the blank 6cc69f00dfe505b_23	$fill in the blank 6cc69f00dfe505b_24

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