4- Part B (Ch. 10-12) The following information applies to the questions display

Question

4- Part B (Ch. 10-12) The following information applies to the questions displayed below Elegant Decor losses or low profits for several years. The company's 2017 departmental income statements shows the following management is trying to decide whether to eliminate Department 200, which has produced For Year Ended December 31, 2017 Cost of goods sold Gross profit Operating expenses $447,000 268,008 179,00e Direct expenses Advertising Store supplies used Depreciation-Store equipment Total direct expenses 31,000 9,600 17,000 s, eee 14,000 4,600 5,0048,900 27,800 Allocated expenses 31,200 4,740 7,380 12,480 1,100 83,200 14,150 16,800 31,200 3,000 Sales salaries 52,000 9,410 9,500 18,720 1,900 2,100 Bad debts expense office salary Insurance expense 1e01,see3,600 Total a1located expenses Total expenses 630 80,220 s 58,370 (9,220) 49,150 In analyzing whether to eliminate Department 200, management considers the following 42 AM to search

Explanation / Answer

Elegant Decor Company

Forecasted Annual Income Statement

Under Plan to Eliminate Department 200

$ $ Sales 447,000 Cost of Goods Sold 268,000 Gross Profit 179,000 Operating Expenses Direct Expenses Advertising 17,000 Store Supplies used 5,000 Depreciation - Store Equipment 8,300 Total Direct Expenses 30,300 Allocated Expenses Sales Salaries $ ( 20,800 x 2 + 31,200 / 2) 57,200 Rent Expense 14,150 Bad Debt Expense 9,500 Office Salary ( $ 31,200 / 2) 15,600 Insurance Expense $ ( 1,900 + 1,100 x 35%) 2,285 Miscellaneous Office Expenses $ ( 2,100 + 1,500 x 84%) 3,360 Total Allocated Expenses 102,095 Total Operating Expenses 132,395 Net Operating Income ( Loss) 46,605

Related Questions

Navigate

• Browse (All)
• Browse 4
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.