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raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operatin percentage, analyze the following financial information to determine costs that may need further investigation. Marley's Manufacturing Income Statement Month Ending August 31, 2018 Dept. A Dept. B Sales $22,000 $52,000 Cost of goods sold 10,560 26,520 Gross profit $11,440 $25,480 Expenses: Utility expenses $1,100 $3,120 Wages expense 5,500 9,880 Costs allocated from corporate 2,420 15,600 Total expenses $9,020 $28,600 Operating income/(loss) in dollars Operating income/(loss) in percentage % %

raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operatin percentage, analyze the following financial information to determine costs that may need further investigation. Marley's Manufacturing Income Statement Month Ending August 31, 2018 Dept. A Dept. B Sales $22,000 $52,000 Cost of goods sold 10,560 26,520 Gross profit $11,440 $25,480 Expenses: Utility expenses $1,100 $3,120 Wages expense 5,500 9,880 Costs allocated from corporate 2,420 15,600 Total expenses $9,020 $28,600 Operating income/(loss) in dollars Operating income/(loss) in percentage % %

Principles of Accounting Volume 2
Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter9: Responsibility Accounting And Decentralization
Section: Chapter Questions
Problem 5EA: Assume you are the department B manager for Marleys Manufacturing. Marleys operates under a...
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Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operating income in percentage, analyze the following financial information to determine costs that may need further investigation.

Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operating income in percentage, analyze the following financial information to determine costs that may need further investigation. Marley's Manufacturing Income Statement Month Ending August 31, 2018 Dept. A Dept. B Sales $22,000 $52,000 Cost of goods sold 10,560 26,520 Gross profit $11,440 $25,480 Expenses: Utility expenses $1,100 $3,120 Wages expense 5,500 9,880 Costs allocated from corporate 2,420 15,600 Total expenses $9,020 $28,600 Operating income/(loss) in dollars Operating income/(loss) in percentage % %
Transcribed Image Text:Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operating income in percentage, analyze the following financial information to determine costs that may need further investigation. Marley's Manufacturing Income Statement Month Ending August 31, 2018 Dept. A Dept. B Sales $22,000 $52,000 Cost of goods sold 10,560 26,520 Gross profit $11,440 $25,480 Expenses: Utility expenses $1,100 $3,120 Wages expense 5,500 9,880 Costs allocated from corporate 2,420 15,600 Total expenses $9,020 $28,600 Operating income/(loss) in dollars Operating income/(loss) in percentage % %
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