Below are departmental income statements for a guitar
manufacturer. The
company classifies advertising, rent, and
utilities as indirect expenses. The manufacturer is considering
eliminating its Electric Guitar department because it shows a
loss.
- Below Are Departmental Income Statements For A Guitar Manufacturer The Company Classifies Advertising Rent And Utilit 1 (46.65 KiB) Viewed 84 times
- Below Are Departmental Income Statements For A Guitar Manufacturer The Company Classifies Advertising Rent And Utilit 2 (40.77 KiB) Viewed 84 times
Below are departmental income statements for a guitar manufacturer. The
company classifies advertising, rent, and utilities as indirect expenses. The manufacturer is considering eliminating its Electric Guitar department because it shows a loss. Electric $105,500 66,750 38,750 Departmental Income Statements For Year Ended December 31 Acoustic Sales $112,500 Cost of goods sold 55,675 Gross profit 56,825 Expenses Advertising 8,075 Depreciation Equipment 10,150 Salaries 17,300 Supplies used 2,030 Rent 6,105 Utilities 3,045 Total expenses 46,705 Income (loss) $10,120 6,250 9,000 13,500 1,700 5,950 2,550 38,950 ($200 Required: 1. Prepare a departmental contribution to overhead report. a (Use cells A7 to C18 from the given information to complete this
question.) Departmental Contribution to Overhead For Year Ended December 31 Acoustic Electric Combined Gross profit Direct expenses Total direct expenses Departmental contribution to overhead 2. Based on contribution to overhead, should the electric guitar department be eliminated? Based on contribution to overhead, should the electric guitar department be eliminated?
Required: 1. Prepare a departmental contribution to overhead report. (Use cells A7 to C18 from the given information to complete this
question.) Departmental Contribution to Overhead For Year Ended December 31 Acoustic Electric Combined Sales Cost of goods sold Advertising Depreciation Equipment Salaries Supplies used Rent Utilities cara the electric guitar department be eliminated? Based on contribution to overhead, should the electric guitar department be eliminated?