Using the data below for the Ace Guitar Company: A Region B Region Sales $500,000 $900,000 Cost of goods sold 200,000 300,000 Selling expenses 150,000 275,000 Support department expenses: Purchasing $90,000 Payroll accounting 30,000 Allocate support department expenses proportional to the sales of each region. Determine the divisional operating income for the A and B regions. For interim calculations, round percentages to one decimal place and all other amounts to the nearest whole dollar.
Using the data below for the Ace Guitar Company: A Region B Region Sales $500,000 $900,000 Cost of goods sold 200,000 300,000 Selling expenses 150,000 275,000 Support department expenses: Purchasing $90,000 Payroll accounting 30,000 Allocate support department expenses proportional to the sales of each region. Determine the divisional operating income for the A and B regions. For interim calculations, round percentages to one decimal place and all other amounts to the nearest whole dollar.
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter10: Evaluating Decentralized Operations
Section: Chapter Questions
Problem 5E: Service department charges In divisional income statements prepared for Demopolis Company, the...
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Using the data below for the Ace Guitar Company:
| A Region | B Region | |||||
| Sales | $500,000 | $900,000 | ||||
| Cost of goods sold | 200,000 | 300,000 | ||||
| Selling expenses | 150,000 | 275,000 | ||||
| Support department expenses: | ||||||
| Purchasing | $90,000 | |||||
| Payroll accounting | 30,000 |
Allocate support department expenses proportional to the sales of each region. Determine the divisional operating income for the A and B regions. For interim calculations, round percentages to one decimal place and all other amounts to the nearest whole dollar.
| A Region Operating Income | $fill in the blank 1 |
| B Region Operating Income | $fill in the blank 2 |
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