Profit Center Responsibility Reporting XSport 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, 20Y9, the end of the fiscal year, after all adjustments, including those for inventories, were recorded and posted: Sales—Winter Sports Division $34,650,000 Sales—Summer Sports Division 38,280,000 Cost of Goods Sold—Winter Sports Division 20,790,000 Cost of Goods Sold—Summer Sports Division 22,110,000 Sales Expense—Winter Sports Division 5,940,000 Sales Expense—Summer Sports Division 5,280,000 Administrative Expense—Winter Sports Division 3,465,000 Administrative Expense—Summer Sports Division 3,399,000 Advertising Expense 946,000 Transportation Expense 476,800 Accounts Receivable Collection Expense 228,800 Warehouse Expense 3,300,000 The bases to be used in allocating expenses, together with other essential information, are as follows: Advertising expense—incurred at headquarters, charged back to divisions on the basis of usage: Winter Sports Division, $444,000; Summer Sports Division, $502,000. Transportation expense—charged back to divisions at a charge rate of $16 per bill of lading: Winter Sports Division, 14,200 bills of lading; Summer Sports Division, 15,600 bills of lading. Accounts receivable collection expense—incurred at headquarters, charged back to divisions at a charge rate of $8 per invoice: Winter Sports Division, 13,200 sales invoices; Summer Sports Division, 15,400 sales invoices. Warehouse expense—charged back 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. XSport Sporting Goods Co. Divisional Income Statements For the Year Ended December 31, 20Y9 Winter Sports Division Summer Sports Division Sales $fill in the blank ef6b8afeb032ffb_1 $fill in the blank ef6b8afeb032ffb_2 Cost of goods sold fill in the blank ef6b8afeb032ffb_3 fill in the blank ef6b8afeb032ffb_4 Gross profit $fill in the blank ef6b8afeb032ffb_5 $fill in the blank ef6b8afeb032ffb_6 Divisional selling and administrative expenses: Divisional selling expenses $fill in the blank ef6b8afeb032ffb_7 $fill in the blank ef6b8afeb032ffb_8 Divisional administrative expenses fill in the blank ef6b8afeb032ffb_9 fill in the blank ef6b8afeb032ffb_10 Total divisional selling and administrative expenses $fill in the blank ef6b8afeb032ffb_11 $fill in the blank ef6b8afeb032ffb_12 Income from operations before service department charges $fill in the blank ef6b8afeb032ffb_13 $fill in the blank ef6b8afeb032ffb_14 Service department charges: Advertising expense $fill in the blank ef6b8afeb032ffb_15 $fill in the blank ef6b8afeb032ffb_16 Transportation expense fill in the blank ef6b8afeb032ffb_17 fill in the blank ef6b8afeb032ffb_18 Accounts receivable collection expense fill in the blank ef6b8afeb032ffb_19 fill in the blank ef6b8afeb032ffb_20 Warehouse expense fill in the blank ef6b8afeb032ffb_21 fill in the blank ef6b8afeb032ffb_22 Total service department charges $fill in the blank ef6b8afeb032ffb_23 $fill in the blank ef6b8afeb032ffb_24 Income from operations $fill in the blank ef6b8afeb032ffb_25 $fill in the blank ef6b8afeb032ffb_26 Provide supporting schedules for determining service department charges. If required, round per unit amounts to two decimal places and final answers to the nearest dollar. XSport Sporting Goods Co. Service Department Charges For the Year Ended December 31, 20Y9 Winter Sports Division Summer Sports Division Total Advertising expense $fill in the blank 3b8b27f9cfff03f_1 $fill in the blank 3b8b27f9cfff03f_2 $fill in the blank 3b8b27f9cfff03f_3 Transportation rate per bill of lading $fill in the blank 3b8b27f9cfff03f_4 $fill in the blank 3b8b27f9cfff03f_5 Number of bills of lading fill in the blank 3b8b27f9cfff03f_6 fill in the blank 3b8b27f9cfff03f_7 Transportation expense $fill in the blank 3b8b27f9cfff03f_8 $fill in the blank 3b8b27f9cfff03f_9 $fill in the blank 3b8b27f9cfff03f_10 Accounts receivable collection rate $fill in the blank 3b8b27f9cfff03f_11 $fill in the blank 3b8b27f9cfff03f_12 Number of sales invoices fill in the blank 3b8b27f9cfff03f_13 fill in the blank 3b8b27f9cfff03f_14 Accounts receivable collection expense $fill in the blank 3b8b27f9cfff03f_15 $fill in the blank 3b8b27f9cfff03f_16 $fill in the blank 3b8b27f9cfff03f_17 Warehouse rate per sq. ft. $fill in the blank 3b8b27f9cfff03f_18 $fill in the blank 3b8b27f9cfff03f_19 Number of square feet fill in the blank 3b8b27f9cfff03f_20 fill in the blank 3b8b27f9cfff03f_21 Warehouse expense $fill in the blank 3b8b27f9cfff03f_22 $fill in the blank 3b8b27f9cfff03f_23 $fill in the blank 3b8b27f9cfff03f_24

Profit Center Responsibility Reporting XSport 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, 20Y9, the end of the fiscal year, after all adjustments, including those for inventories, were recorded and posted: Sales—Winter Sports Division $34,650,000 Sales—Summer Sports Division 38,280,000 Cost of Goods Sold—Winter Sports Division 20,790,000 Cost of Goods Sold—Summer Sports Division 22,110,000 Sales Expense—Winter Sports Division 5,940,000 Sales Expense—Summer Sports Division 5,280,000 Administrative Expense—Winter Sports Division 3,465,000 Administrative Expense—Summer Sports Division 3,399,000 Advertising Expense 946,000 Transportation Expense 476,800 Accounts Receivable Collection Expense 228,800 Warehouse Expense 3,300,000 The bases to be used in allocating expenses, together with other essential information, are as follows: Advertising expense—incurred at headquarters, charged back to divisions on the basis of usage: Winter Sports Division, $444,000; Summer Sports Division, $502,000. Transportation expense—charged back to divisions at a charge rate of $16 per bill of lading: Winter Sports Division, 14,200 bills of lading; Summer Sports Division, 15,600 bills of lading. Accounts receivable collection expense—incurred at headquarters, charged back to divisions at a charge rate of $8 per invoice: Winter Sports Division, 13,200 sales invoices; Summer Sports Division, 15,400 sales invoices. Warehouse expense—charged back 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. XSport Sporting Goods Co. Divisional Income Statements For the Year Ended December 31, 20Y9 Winter Sports Division Summer Sports Division Sales $fill in the blank ef6b8afeb032ffb_1 $fill in the blank ef6b8afeb032ffb_2 Cost of goods sold fill in the blank ef6b8afeb032ffb_3 fill in the blank ef6b8afeb032ffb_4 Gross profit $fill in the blank ef6b8afeb032ffb_5 $fill in the blank ef6b8afeb032ffb_6 Divisional selling and administrative expenses: Divisional selling expenses $fill in the blank ef6b8afeb032ffb_7 $fill in the blank ef6b8afeb032ffb_8 Divisional administrative expenses fill in the blank ef6b8afeb032ffb_9 fill in the blank ef6b8afeb032ffb_10 Total divisional selling and administrative expenses $fill in the blank ef6b8afeb032ffb_11 $fill in the blank ef6b8afeb032ffb_12 Income from operations before service department charges $fill in the blank ef6b8afeb032ffb_13 $fill in the blank ef6b8afeb032ffb_14 Service department charges: Advertising expense $fill in the blank ef6b8afeb032ffb_15 $fill in the blank ef6b8afeb032ffb_16 Transportation expense fill in the blank ef6b8afeb032ffb_17 fill in the blank ef6b8afeb032ffb_18 Accounts receivable collection expense fill in the blank ef6b8afeb032ffb_19 fill in the blank ef6b8afeb032ffb_20 Warehouse expense fill in the blank ef6b8afeb032ffb_21 fill in the blank ef6b8afeb032ffb_22 Total service department charges $fill in the blank ef6b8afeb032ffb_23 $fill in the blank ef6b8afeb032ffb_24 Income from operations $fill in the blank ef6b8afeb032ffb_25 $fill in the blank ef6b8afeb032ffb_26 Provide supporting schedules for determining service department charges. If required, round per unit amounts to two decimal places and final answers to the nearest dollar. XSport Sporting Goods Co. Service Department Charges For the Year Ended December 31, 20Y9 Winter Sports Division Summer Sports Division Total Advertising expense $fill in the blank 3b8b27f9cfff03f_1 $fill in the blank 3b8b27f9cfff03f_2 $fill in the blank 3b8b27f9cfff03f_3 Transportation rate per bill of lading $fill in the blank 3b8b27f9cfff03f_4 $fill in the blank 3b8b27f9cfff03f_5 Number of bills of lading fill in the blank 3b8b27f9cfff03f_6 fill in the blank 3b8b27f9cfff03f_7 Transportation expense $fill in the blank 3b8b27f9cfff03f_8 $fill in the blank 3b8b27f9cfff03f_9 $fill in the blank 3b8b27f9cfff03f_10 Accounts receivable collection rate $fill in the blank 3b8b27f9cfff03f_11 $fill in the blank 3b8b27f9cfff03f_12 Number of sales invoices fill in the blank 3b8b27f9cfff03f_13 fill in the blank 3b8b27f9cfff03f_14 Accounts receivable collection expense $fill in the blank 3b8b27f9cfff03f_15 $fill in the blank 3b8b27f9cfff03f_16 $fill in the blank 3b8b27f9cfff03f_17 Warehouse rate per sq. ft. $fill in the blank 3b8b27f9cfff03f_18 $fill in the blank 3b8b27f9cfff03f_19 Number of square feet fill in the blank 3b8b27f9cfff03f_20 fill in the blank 3b8b27f9cfff03f_21 Warehouse expense $fill in the blank 3b8b27f9cfff03f_22 $fill in the blank 3b8b27f9cfff03f_23 $fill in the blank 3b8b27f9cfff03f_24

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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Profit Center Responsibility Reporting

XSport 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, 20Y9, the end of the fiscal year, after all adjustments, including those for inventories, were recorded and posted:

Sales—Winter Sports Division	$34,650,000
Sales—Summer Sports Division	38,280,000
Cost of Goods Sold—Winter Sports Division	20,790,000
Cost of Goods Sold—Summer Sports Division	22,110,000
Sales Expense—Winter Sports Division	5,940,000
Sales Expense—Summer Sports Division	5,280,000
Administrative Expense—Winter Sports Division	3,465,000
Administrative Expense—Summer Sports Division	3,399,000
Advertising Expense	946,000
Transportation Expense	476,800
Accounts Receivable Collection Expense	228,800
Warehouse Expense	3,300,000

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

Advertising expense—incurred at headquarters, charged back to divisions on the basis of usage: Winter Sports Division, $444,000; Summer Sports Division, $502,000.
Transportation expense—charged back to divisions at a charge rate of $16 per bill of lading: Winter Sports Division, 14,200 bills of lading; Summer Sports Division, 15,600 bills of lading.
Accounts receivable collection expense—incurred at headquarters, charged back to divisions at a charge rate of $8 per invoice: Winter Sports Division, 13,200 sales invoices; Summer Sports Division, 15,400 sales invoices.
Warehouse expense—charged back 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.

XSport Sporting Goods Co.
Divisional Income Statements
For the Year Ended December 31, 20Y9
	Winter Sports Division	Summer Sports Division
Sales	$fill in the blank ef6b8afeb032ffb_1	$fill in the blank ef6b8afeb032ffb_2
Cost of goods sold	fill in the blank ef6b8afeb032ffb_3	fill in the blank ef6b8afeb032ffb_4
Gross profit	$fill in the blank ef6b8afeb032ffb_5	$fill in the blank ef6b8afeb032ffb_6
Divisional selling and administrative expenses:
Divisional selling expenses	$fill in the blank ef6b8afeb032ffb_7	$fill in the blank ef6b8afeb032ffb_8
Divisional administrative expenses	fill in the blank ef6b8afeb032ffb_9	fill in the blank ef6b8afeb032ffb_10
Total divisional selling and administrative expenses	$fill in the blank ef6b8afeb032ffb_11	$fill in the blank ef6b8afeb032ffb_12
Income from operations before service department charges	$fill in the blank ef6b8afeb032ffb_13	$fill in the blank ef6b8afeb032ffb_14
Service department charges:
Advertising expense	$fill in the blank ef6b8afeb032ffb_15	$fill in the blank ef6b8afeb032ffb_16
Transportation expense	fill in the blank ef6b8afeb032ffb_17	fill in the blank ef6b8afeb032ffb_18
Accounts receivable collection expense	fill in the blank ef6b8afeb032ffb_19	fill in the blank ef6b8afeb032ffb_20
Warehouse expense	fill in the blank ef6b8afeb032ffb_21	fill in the blank ef6b8afeb032ffb_22
Total service department charges	$fill in the blank ef6b8afeb032ffb_23	$fill in the blank ef6b8afeb032ffb_24
Income from operations	$fill in the blank ef6b8afeb032ffb_25	$fill in the blank ef6b8afeb032ffb_26

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

XSport Sporting Goods Co.
Service Department Charges
For the Year Ended December 31, 20Y9
	Winter Sports Division	Summer Sports Division	Total
Advertising expense	$fill in the blank 3b8b27f9cfff03f_1	$fill in the blank 3b8b27f9cfff03f_2	$fill in the blank 3b8b27f9cfff03f_3
Transportation rate per bill of lading	$fill in the blank 3b8b27f9cfff03f_4	$fill in the blank 3b8b27f9cfff03f_5
Number of bills of lading	fill in the blank 3b8b27f9cfff03f_6	fill in the blank 3b8b27f9cfff03f_7
Transportation expense	$fill in the blank 3b8b27f9cfff03f_8	$fill in the blank 3b8b27f9cfff03f_9	$fill in the blank 3b8b27f9cfff03f_10
Accounts receivable collection rate	$fill in the blank 3b8b27f9cfff03f_11	$fill in the blank 3b8b27f9cfff03f_12
Number of sales invoices	fill in the blank 3b8b27f9cfff03f_13	fill in the blank 3b8b27f9cfff03f_14
Accounts receivable collection expense	$fill in the blank 3b8b27f9cfff03f_15	$fill in the blank 3b8b27f9cfff03f_16	$fill in the blank 3b8b27f9cfff03f_17
Warehouse rate per sq. ft.	$fill in the blank 3b8b27f9cfff03f_18	$fill in the blank 3b8b27f9cfff03f_19
Number of square feet	fill in the blank 3b8b27f9cfff03f_20	fill in the blank 3b8b27f9cfff03f_21
Warehouse expense	$fill in the blank 3b8b27f9cfff03f_22	$fill in the blank 3b8b27f9cfff03f_23	$fill in the blank 3b8b27f9cfff03f_24

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