The centralized computer technology department of Hardy Company has expenses of

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The centralized computer technology department of Hardy Company has expenses of $320,000. The department has provided a total of 4,000 hours of service for the period. The Retail Division has used 2,750 hours of computer technology service during the period, and the Commercial Division has used 1,250 hours of computer technology service. Additional data for the two divisions is following below:

Determine the divisional income from operations for the Retail Division and the Commercial Division. Do not round interim calculations.

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Retail Division Commercial Division Sales $2,150,000 $1,200,000 Cost of goods sold 1,300,000 800,000 Selling expenses 150,000 175,000 Cengage CengageNOWv2 | Online teaching and learning resource from Cengage Learning 24-2 Practice Excercises Show Me How Calculator Income from Operations for Profit Center The centralized computer technology department of Hardy Company has expenses of $320,000. The department has provided a total of 4,000 hours of service for the period. The Retail Division has used 2,750 hours of computer technology service during the period, and the Commercial Division has used 1,250 hours of computer technology service. Additional data for the two divisions is following below Retail Division Commercial Division Sales Cost of goods sold 1,300,000 Selling expenses Determine the divisional income from operations for the Retail Division and the Commercial Division. Do not round interim calculations. $1,200,000 800,000 175,000 $2,150,000 150,000 Hardy Company Divisional Income from Operations Retail Division Commercial Division Income from operations Check My Work 2 more Check My Work uses remaining. Assignment Score: 20% Email Instructor Save and Exit Submit Assignment for Grading

Explanation / Answer

DIVISIONAL INCOME FROM OPERATIONS RETAIL COMMERCIAL Sales revenue 2,150,000 1,200,000 Less: Cost of goods sold 1,300,000 800,000 Gross Margin 850,000 400,000 Less: Centralized division Cost 220,000 100,000 ($ 320,000 in 2750:1250) 630,000 300,000 Less: Selling expense 150,000 175,000 Net income 480,000 125,000

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