HE 22 6 Saved Help Save&Exit; Sutbmit Check my work 3 Below are departmental inc

Question

HE 22 6 Saved Help Save&Exit; Sutbmit Check my work 3 Below are departmental income statements for a guitar manufacturer. The manufacturer is considering eliminating its electric guitar department since it has a net loss. The company classifies advertising, rent, and utilities expenses as indirect WHOLESALE GUITARS Departmental Income Statements For Tear Ended December 31, 2017 points Acoustie Electrie eBook Hint Print Sales Cost of goods sold Gross profit Operating expenses 102,700$84,100 43,87547,150 8,82536,950 5,0254,280 10,1508,500 19,3007,400 Advertising expense Depreciation expense-equipment Salarles expense Supplies expense Rent expense Ueilities expense 2,020 1,750 70756,020 ,035 2,640 46,605 40,590 Total operating expenses Net incone (loss) 12,22O 13,640)

Explanation / Answer

Accoustic Electirc combined dept dept Sales 102,700 84,100 186,800 Cost of goods sold 43,875 47,150 91,025 Gross profit 58,825 36,950 95,775 Direct expenses Depreciation expense-Equipment 10,150 8,500 18,650 Salaries expense 19,300 17,400 36,700 supplies expense 2,020 1,700 3,720 total direct expense 31,470 27,600 59,070 Departmental conribution to overhead 27,355 9,350 36,705 indirect expenses Advertising expense 9,305 rent expense 13,095 utilities expense 5,675 total indirect expense 31,975 net income 9,920 N0

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