The Ski department reports sales of $625,000 and cost of goods sold of $437,500. Its expenses follow.Direct Expenses Indirect Expenses Service Department Expenses Salaries$118,000Rent$16,100Office$24,200Depreciations44,600 Req 1Req 2 and 3For the Ski department only, prepare a departmental income statement.Departmental Income StatementFor Year Ended December 31Ski DepartmentExpensesTotal expenses$ Req 1Req 2 and 3For the Ski department only, prepare a departmental contribution to overhead report. Based on these two reports, should theSki department be eliminated?Departmental Contribution to OverheadFor Year Ended December 31Ski DepartmentTotal direct expensesDepartmental contribution to overheadShould the Ski department be eliminated?Req 2 and 3 >YesNo%24

Departmental Income Statement: It is a sort of income statement that displays the contribution…

The Ski department reports sales of $625,000 and cost of goods sold of $437,500. Its expenses follow. Direct Expenses Indirect Expenses Service Department Expenses Salaries $118,000 Rent $16,100 Office $24,200 Depreciations 44,600

The Ski department reports sales of $625,000 and cost of goods sold of $437,500. Its expenses follow. Direct Expenses Indirect Expenses Service Department Expenses Salaries $118,000 Rent $16,100 Office $24,200 Depreciations 44,600

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

The gross profit for the Rails Division is
Countywide Cable Services, Inc., is organized with three segments: Metro, Suburban, and Outlying. Data for these segments for the year just ended follow. Metro Suburban Service revenue Variable expenses Controllable fixed expenses Fixed expenses controllable by others $970,000 154, 000 356,000 184,000 $770,000 104,000 276,000 154,000 Outlying $370,000 54,000 106,000 44,000 In addition to the expenses listed above, the company has $55,000 of common fixed expenses. Income-tax expense for the year is $255,000. ces Required: 1. Prepare a segmented income statement for Countywide Cable Services, Inc. SEGMENTED INCOME STATEMENTS: COUNTYWIDE CABLE SERVICES, INC. Segments of Company Countywide Cable Services Outlying Metro Suburban Segment contribution margin < Prev 2 of 7 Next
The Azuza Company owns no plant assets and had the following income statement for the year: Sales revenue $930,000 Cost of goods sold $650,000 Wages expense 210,000 Rent expense 42,000 Utilities expense 12,000 914,000 Net income $16,000 Additional information about the company includes: End ofYear Beginning ofYear Accounts receivable $67,000 $59,000 Inventory 62,000 86,000 Prepaid rent 9,000 7,000 Accounts payable 22,000 30,000 Wages payable 9,000 7,000 Use the preceding information to calculate the cash flow from operating activities using the indirect method. Remember to use negative signs with answers when appropriate.
Solaris Corporation prepared the following estimates for the four quarters of the current year: FirstQuarter SecondQuarter ThirdQuarter FourthQuarter Sales $ 1,375,000 $ 1,650,000 $ 1,925,000 $ 2,200,000 Cost of goods sold 442,000 522,000 592,000 642,000 Administrative costs 460,000 260,000 265,000 275,000 Advertising costs 0 160,000 0 0 Executive bonuses 0 0 0 88,000 Provision for bad debts 0 0 0 52,000 Annual maintenance costs 70,000 0 0 0 Additional Information First-quarter administrative costs include the $200,000 annual insurance premium. Advertising costs paid in the second quarter relate to television advertisements that will be broadcast throughout the entire year. No special items affect income during the year. The company estimates an effective income tax rate for the year of 25 percent. Assuming that actual results do not vary from the…
Following is information for the Rooms Department for the Ocean Front Hotel for the first six periods of the year. Room Revenue $8,713,000 Transient Rooms Sold 83,730 Group Rooms Sold 16,270 Total Rooms Sold 100,000 Operating Expenses Linen $31,100 Cleaning Supplies $24,000 Guest Supplies $104,800 Outside Services $24,000 Laundry $80,500 Concierge Expense $60,000 Office Supplies $19,200 Reservation Expenses Reservation Department $150,000 Fixed Res Center Cost $180,000 Variable Reser. Center Cost at $6 per transient res. $251,200 Total Reservation Expense $581,200 All other Expense $120,000 Total Operating Expenses $1,044,800 Total Operating Expense Percentage 12.0% Use the table above to answer Use the following formulas to calculate each one of the line items. They will be used to prepare the annual budget for next year. Round the average cost per period to whole dollars, round the cost per occupied room…
Outdoor World, Inc., manufactures camping equipment. Shown for the current year are the income statement for the company and a common size summary for the industry in which the company operates. Outdoor World, Inc. Industry Average Sales (net) $ 20,000,000 100 % Cost of goods sold 9,800,000 58 Gross profit on sales $10,200,000 42 % Operating expenses: Selling $ 4,200,000 16 % General and administrative 3,400,000 20 Total operating expenses $7,600,000 36 % Operating income $ 2,600,000 6 % Income tax expense 1,200,000 3 Net income $1,400,000 3 % Return on assets 23 % 14% Required: a. Prepare a common size income statement. The first column should show for Outdoor World, Inc., all items expressed as a percentage of net sales. The second column has been completed and shows the equivalent industry average for the data given in the problem. The purpose of this common size statement is to compare the operating results of Outdoor World, Inc., with the average for the industry. b. If results of…
Jansen Company reports the following for its ski department for the year 2019. All of its costs are direct, except as noted. Sales $ 605,000 Cost of goods sold 430,000 Salaries 112,000 ($25,600 is indirect) Utilities 17,200 ($5,100 is indirect) Depreciation 45,000 ($17,100 is indirect) Office expenses 22,800 (all indirect) 1. Prepare a departmental income statement for 2019.2. & 3. Prepare a departmental contribution to overhead report for 2019. Based on these two performance reports, should Jansen eliminate the ski department?
The Boston Beer Company Inc. (SAM) produces Samuel Adams beer and other alcoholic beverages. Boston Beer reported the following operating information for a recent year (in thousands): Line Item Description Amount Amount Sales $9,680,000 Cost of goods sold $2,420,000 Selling, general, and administrative expenses 550,000 (2,970,000) Operating income $6,710,000* *Before special items In addition, assume that Boston Beer sold 55,000 thousand barrels of beer during the year. Assume that variable costs were 75% of the cost of goods sold and 50% of selling, general, and administrative expenses. Assume that the remaining costs are fixed. For the following year, assume that Boston Beer expects pricing, variable costs per barrel, and fixed costs to remain constant, except that new distribution and general office facilities are expected to increase fixed costs by $26.40 million. a. Compute the break-even number of barrels for the current year. Round to the nearest…
The unallocated income statement of De Souza Motel is shown below: Rooms F&B Total Revenue 257,000 133,000 390,000 Cost of Sales 48,000 48,000 Payroll and Related Expenses 60,000 30,000 90,000 Other Direct Expenses 40,000 12,000 52,000 Total Expenses 100,000 90,000 190,000 Departmental Income 157,000 43,000 200,000 Administrative &General 60,000 Sales&Marketing 25,000 POM&Utility costs 20,000 GOP 95,000 Insurance 10,000 Depreciation 12,000 Total Fixed Charges 22,000 Income Before Income Taxes 73,000 Income Taxes 30,000 Net Income 47,000 Square Footage: Rooms- 120,000; F&B- 70,000 Required: 1.Which costs are indirect costs? Explain why! 2.Using square footage and the unallocated income statement , prepare a fully allocated income statement.…
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 $12,600,000 Sales—Summer Sports Division 16,300,000 Cost of Goods Sold—Winter Sports Division 7,560,000 Cost of Goods Sold—Summer Sports Division 9,454,000 Sales Expense—Winter Sports Division 2,016,000 Sales Expense—Summer Sports Division 2,282,000 Administrative Expense—Winter Sports Division 1,260,000 Administrative Expense—Summer Sports Division 1,450,700 Advertising Expense 578,000 Transportation Expense 265,660 Accounts Receivable Collection Expense 174,000 Warehouse Expense 1,540,000 The bases to be used in allocating expenses, together with other essential information, are as follows: A.…
The following financial information was summarized from the accounting records of Train Corporation for the current year ended December 31: Rails Division Locomotive Division Corporate Total Cost of goods sold $45,400 $28,200 Direct operating expenses 27,600 22,400 Sales 99,800 66,800 Interest expense $2,000 General overhead 18,100 Income tax 4,200 The gross profit for the Locomotive Division is
Sales 218,000 Gain on sale of equipment $ 6,290 epreciation expense—Office copier $ 530 Office supplies expense 620 Sales discounts 16,700 Insurance expense 1,380 Sales returns and allowances 3,900 TV advertising expense 3,800 Office salaries expense 31,100 Interest revenue 650 Rent expense—Selling space 11,600 Cost of goods sold 91,000 Sales staff wages 23,700 Sales commission expense 13,100 whats the total income profited