Vortex Company operates a retail store with two departments. Information about those departments follows.Department A$800,000497,000Department B$450,000291,000SalesCost of goods soldDirect expenses:125,00020,00024,00021,0007,00088,00010,00014,00012,0005,000SalariesInsuranceUtilitiesDepreciationMaintenanceThe company also incurred the following indirect costs.$36,0006,00015,00050,000SalariesInsuranceDepreciationOffice expensesIndirect costs are allocated as follows: salaries on the basis of sales; insurance and depreciation on the basis of square footage; andoffice expenses on the basis of number of employees. Additional information about the departments follows.Number of employeesSquare footage28,00012,000DepartmentA7550Required:1. Determine the departmental contribution to overhead and the departmental net income for department A and Department B.2. Should Department B be eliminated? VORTEX COMPANYDepartmental Contribution StatementsDepartment A Department BDirect expensesTotal direct expensesAllocated indirect expensesTotal indirect expensesOperating income (loss)0 $0.%24

Answered: Image /qna-images/answer/71b1061a-9498-4fbf-8e8b-6f07559fc772.jpg

Answered: Required: 1. Determine the departmental…

Required: 1. Determine the departmental contribution to overhead and the departmental net income for department A and Department B. 2. Should Department B be eliminated?

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter5: Accounting For Retail Businesses

Section: Chapter Questions

Problem 2MAD: Analyze Dollar General Dollar General Corporation (DG) is a discount retailer with more than 12,000...

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