Burien,Inc.,operates a retail store with two departments,A and B.Its departmental income statement for the current year follows:

Burien allocates building depreciation,maintenance,and utilities on the basis of square footage.Office expenses are allocated on the basis of sales.
Management is considering an expansion to a three-department operation.The proposed Department C would generate $120,000 in additional sales and have a 17.5% contribution to overhead.The company owns its building.Opening Department C would redistribute the square footage to each department as follows:
A,19,040; B,21,760 sq.ft.; C,13,600.Increases in indirect expenses would include:
maintenance,$500; utilities,$3,800; and office expenses,$1,200.
Complete the following departmental income statements,showing projected results of operations for the three sales departments.(Round amounts to the nearest whole dollar.)

Question

Burien,Inc.,operates a retail store with two departments,A and B.Its departmental income statement for the current year follows:
  
Burien allocates building depreciation,maintenance,and utilities on the basis of square footage.Office expenses are allocated on the basis of sales.
Management is considering an expansion to a three-department operation.The proposed Department C would generate $120,000 in additional sales and have a 17.5% contribution to overhead.The company owns its building.Opening Department C would redistribute the square footage to each department as follows:
 A,19,040; B,21,760 sq.ft.; C,13,600.Increases in indirect expenses would include:
 maintenance,$500; utilities,$3,800; and office expenses,$1,200.
Complete the following departmental income statements,showing projected results of operations for the three sales departments.(Round amounts to the nearest whole dollar.)

Quizplus · Accepted Answer

The Answer of Burien,Inc.,operates a retail store with two departments,A and B.Its departmental income statement for the current year follows:
  
Burien allocates building depreciation,maintenance,and utilities on the basis of square footage.Office expenses are allocated on the basis of sales.
Management is considering an expansion to a three-department operation.The proposed Department C would generate $120,000 in additional sales and have a 17.5% contribution to overhead.The company owns its building.Opening Department C would redistribute the square footage to each department as follows:
 A,19,040; B,21,760 sq.ft.; C,13,600.Increases in indirect expenses would include:
 maintenance,$500; utilities,$3,800; and office expenses,$1,200.
Complete the following departmental income statements,showing projected results of operations for the three sales departments.(Round amounts to the nearest whole dollar.)