Profit Center Responsibility Reporting Championship Sports Inc. operates two divisions—the Winter Sports Division and the Summer Sports Division. The following income and expense accounts were provided from the trial balance as of December 31, 20Y9, the end of the fiscal year, after all adjustments, including those for inventories, were recorded and posted: Sales—Winter Sports Division $8,900,000 Sales—Summer Sports Division 16,400,000 Cost of Goods Sold—Winter Sports Division 5,000,000 Cost of Goods Sold—Summer Sports Division 9,000,000 Sales Expense—Winter Sports Division 650,000 Sales Expense—Summer Sports Division 1,200,000 Administrative Expense—Winter Sports Division 800,000 Administrative Expense—Summer Sports Division 1,450,000 Advertising Expense 1,090,000 Transportation Expense 192,000 Accounts Receivable Collection Expense 68,000 Warehouse Expense 1,800,000 The bases to be used in allocating expenses, together with other information, are as follows: Advertising expense—incurred at headquarters, allocated to divisions on the basis of usage: Winter Sports Division, $375,000; Summer Sports Division, $715,000. Transportation expense—allocated to divisions at a rate of $4.00 per bill of lading: Winter Sports Division, 17,500 bills of lading; Summer Sports Division, 30,500 bills of lading. Accounts receivable collection expense—incurred at headquarters, allocated to divisions at a rate of $1.00 per invoice: Winter Sports Division, 25,000 sales invoices; Summer Sports Division, 43,000 sales invoices. Warehouse expense—allocated to divisions on the basis of floor space used in storing division products: Winter Sports Division, 60,000 square feet; Summer Sports Division, 90,000 square feet. Prepare a divisional income statement with two column headings: Winter Sports Division and Summer Sports Division. Round your interim calculations to two decimal places, if required. Championship Sports Inc. Divisional Income Statements For the Year Ended December 31, 20Y9 Winter Sports Division Summer Sports Division Sales $fill in the blank 2a63bcfa407807a_1 $fill in the blank 2a63bcfa407807a_2 Cost of goods sold fill in the blank 2a63bcfa407807a_3 fill in the blank 2a63bcfa407807a_4 Gross profit $fill in the blank 2a63bcfa407807a_5 $fill in the blank 2a63bcfa407807a_6 Divisional selling and administrative expenses: Divisional selling expenses $fill in the blank 2a63bcfa407807a_7 $fill in the blank 2a63bcfa407807a_8 Divisional administrative expenses fill in the blank 2a63bcfa407807a_9 fill in the blank 2a63bcfa407807a_10 Total divisional selling and administrative expenses $fill in the blank 2a63bcfa407807a_11 $fill in the blank 2a63bcfa407807a_12 Operating income before support department allocations $fill in the blank 2a63bcfa407807a_13 $fill in the blank 2a63bcfa407807a_14 Support department allocations: Advertising expense $fill in the blank 2a63bcfa407807a_15 $fill in the blank 2a63bcfa407807a_16 Transportation expense fill in the blank 2a63bcfa407807a_17 fill in the blank 2a63bcfa407807a_18 Accounts receivable collection expense fill in the blank 2a63bcfa407807a_19 fill in the blank 2a63bcfa407807a_20 Warehouse expense fill in the blank 2a63bcfa407807a_21 fill in the blank 2a63bcfa407807a_22 Total support department allocations $fill in the blank 2a63bcfa407807a_23 $fill in the blank 2a63bcfa407807a_24 Operating income $fill in the blank 2a63bcfa407807a_25 $fill in the blank 2a63bcfa407807a_26 Provide supporting calculations for support department allocations. If required, round per unit amounts to two decimal places and final answers to the nearest dollar. Championship Sports Inc. Support Department Allocations For the Year Ended December 31, 20Y9 Winter Sports Division Summer Sports Division Total Advertising expense $fill in the blank 066fdbfecfd107b_1 $fill in the blank 066fdbfecfd107b_2 $fill in the blank 066fdbfecfd107b_3 Transportation rate per bill of lading $fill in the blank 066fdbfecfd107b_4 $fill in the blank 066fdbfecfd107b_5 Number of bills of lading fill in the blank 066fdbfecfd107b_6 fill in the blank 066fdbfecfd107b_7 Transportation expense $fill in the blank 066fdbfecfd107b_8 $fill in the blank 066fdbfecfd107b_9 $fill in the blank 066fdbfecfd107b_10 Accounts receivable collection rate $fill in the blank 066fdbfecfd107b_11 $fill in the blank 066fdbfecfd107b_12 Number of sales invoices fill in the blank 066fdbfecfd107b_13 fill in the blank 066fdbfecfd107b_14 Accounts receivable collection expense $fill in the blank 066fdbfecfd107b_15 $fill in the blank 066fdbfecfd107b_16 $fill in the blank 066fdbfecfd107b_17 Warehouse rate per sq. ft. $fill in the blank 066fdbfecfd107b_18 $fill in the blank 066fdbfecfd107b_19 Number of square feet fill in the blank 066fdbfecfd107b_20 fill in the blank 066fdbfecfd107b_21 Warehouse expense $fill in the blank 066fdbfecfd107b_22 $fill in the blank 066fdbfecfd107b_23 $fill in the blank 066fdbfecfd107b_24
Profit Center Responsibility Reporting
Championship Sports Inc. operates two divisions—the Winter Sports Division and the Summer Sports Division. The following income and expense accounts were provided from the
Sales—Winter Sports Division | $8,900,000 |
Sales—Summer Sports Division | 16,400,000 |
Cost of Goods Sold—Winter Sports Division | 5,000,000 |
Cost of Goods Sold—Summer Sports Division | 9,000,000 |
Sales Expense—Winter Sports Division | 650,000 |
Sales Expense—Summer Sports Division | 1,200,000 |
Administrative Expense—Winter Sports Division | 800,000 |
Administrative Expense—Summer Sports Division | 1,450,000 |
Advertising Expense | 1,090,000 |
Transportation Expense | 192,000 |
Accounts Receivable Collection Expense | 68,000 |
Warehouse Expense | 1,800,000 |
The bases to be used in allocating expenses, together with other information, are as follows:
- Advertising expense—incurred at headquarters, allocated to divisions on the basis of usage: Winter Sports Division, $375,000; Summer Sports Division, $715,000.
- Transportation expense—allocated to divisions at a rate of $4.00 per bill of lading: Winter Sports Division, 17,500 bills of lading; Summer Sports Division, 30,500 bills of lading.
- Accounts receivable collection expense—incurred at headquarters, allocated to divisions at a rate of $1.00 per invoice: Winter Sports Division, 25,000 sales invoices; Summer Sports Division, 43,000 sales invoices.
- Warehouse expense—allocated to divisions on the basis of floor space used in storing division products: Winter Sports Division, 60,000 square feet; Summer Sports Division, 90,000 square feet.
Prepare a divisional income statement with two column headings: Winter Sports Division and Summer Sports Division. Round your interim calculations to two decimal places, if required.
Championship Sports Inc. | ||
Divisional Income Statements | ||
For the Year Ended December 31, 20Y9 | ||
Winter Sports Division | Summer Sports Division | |
Sales | $fill in the blank 2a63bcfa407807a_1 | $fill in the blank 2a63bcfa407807a_2 |
Cost of goods sold | fill in the blank 2a63bcfa407807a_3 | fill in the blank 2a63bcfa407807a_4 |
Gross profit | $fill in the blank 2a63bcfa407807a_5 | $fill in the blank 2a63bcfa407807a_6 |
Divisional selling and administrative expenses: | ||
Divisional selling expenses | $fill in the blank 2a63bcfa407807a_7 | $fill in the blank 2a63bcfa407807a_8 |
Divisional administrative expenses | fill in the blank 2a63bcfa407807a_9 | fill in the blank 2a63bcfa407807a_10 |
Total divisional selling and administrative expenses | $fill in the blank 2a63bcfa407807a_11 | $fill in the blank 2a63bcfa407807a_12 |
Operating income before support department allocations | $fill in the blank 2a63bcfa407807a_13 | $fill in the blank 2a63bcfa407807a_14 |
Support department allocations: | ||
Advertising expense | $fill in the blank 2a63bcfa407807a_15 | $fill in the blank 2a63bcfa407807a_16 |
Transportation expense | fill in the blank 2a63bcfa407807a_17 | fill in the blank 2a63bcfa407807a_18 |
Accounts receivable collection expense | fill in the blank 2a63bcfa407807a_19 | fill in the blank 2a63bcfa407807a_20 |
Warehouse expense | fill in the blank 2a63bcfa407807a_21 | fill in the blank 2a63bcfa407807a_22 |
Total support department allocations | $fill in the blank 2a63bcfa407807a_23 | $fill in the blank 2a63bcfa407807a_24 |
Operating income | $fill in the blank 2a63bcfa407807a_25 | $fill in the blank 2a63bcfa407807a_26 |
Provide supporting calculations for support department allocations. If required, round per unit amounts to two decimal places and final answers to the nearest dollar.
Championship Sports Inc. | |||
Support Department Allocations | |||
For the Year Ended December 31, 20Y9 | |||
Winter Sports Division | Summer Sports Division | Total | |
Advertising expense | $fill in the blank 066fdbfecfd107b_1 | $fill in the blank 066fdbfecfd107b_2 | $fill in the blank 066fdbfecfd107b_3 |
Transportation rate per bill of lading | $fill in the blank 066fdbfecfd107b_4 | $fill in the blank 066fdbfecfd107b_5 | |
Number of bills of lading | fill in the blank 066fdbfecfd107b_6 | fill in the blank 066fdbfecfd107b_7 | |
Transportation expense | $fill in the blank 066fdbfecfd107b_8 | $fill in the blank 066fdbfecfd107b_9 | $fill in the blank 066fdbfecfd107b_10 |
Accounts receivable collection rate | $fill in the blank 066fdbfecfd107b_11 | $fill in the blank 066fdbfecfd107b_12 | |
Number of sales invoices | fill in the blank 066fdbfecfd107b_13 | fill in the blank 066fdbfecfd107b_14 | |
Accounts receivable collection expense | $fill in the blank 066fdbfecfd107b_15 | $fill in the blank 066fdbfecfd107b_16 | $fill in the blank 066fdbfecfd107b_17 |
Warehouse rate per sq. ft. | $fill in the blank 066fdbfecfd107b_18 | $fill in the blank 066fdbfecfd107b_19 | |
Number of square feet | fill in the blank 066fdbfecfd107b_20 | fill in the blank 066fdbfecfd107b_21 | |
Warehouse expense | $fill in the blank 066fdbfecfd107b_22 | $fill in the blank 066fdbfecfd107b_23 | $fill in the blank 066fdbfecfd107b_24 |
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