Mach Co. operates three manufacturing departments as profit centers. The followi

Question

Mach Co. operates three manufacturing departments as profit centers. The following information is available for its most recent year:

Dept. Sales. Cost of Goods Sold. Direct Expenses. Indirect Expenses
1 $1,000,000 $700,000 $100,000 $80,000
2 400,000 150,000 40,000 100,000
3 700,000 300,000 150,000 20,000

Which department has the greatest departmental contribution to overhead and what is the amount contributed?
Dept. 3; $400,000
Dept. 1; $1,000,000
Dept. 2; $100,000
Dept. 3; $250,000
Dept. 2; $150,000

Explanation / Answer

Which department has the greatest departmental contribution to overhead and what is the amount contributed?
Dept. 3; $400,000
Dept. 1; $1,000,000
Dept. 2; $100,000
Dept. 3; $250,000
Dept. 2; $150,000

sales-cost of good sold

700000-300000=400000

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