Prepare a division income statement with two column

Reference no: EM13482699

Big Bear Athletic Equipment Co. operates two division - the Winter Sports Division and the Summer Sports Division. The following income and expense accounts were provided from the trial balance as of June 30, 2008, the end of the current fiscal year, after all adjustments, including those for inventories, were recorded and posted:

Sales - Winter Sports (WS) Division...$950,000
Sales - Summer Sports (SS) Division...$1,437,500
COGS - (WS) Division...$512,500
COGS - (SS) Division...$687,500
Sales Exp - (WS) Division...$150,000
Sales Exp - (SS) Division...$205,000
Admini Exp - (WS) Division...$97,000
Admini Exp - (SS) Division...$128,000
Advertising Exp...$64,500
Transportation Exp...$100,700
A/R Collection Exp...$58,100
Warehouse Exp...$120,000

The bases to be used in allocating expenses, together with other essential information, are as follows:

a. Advertising Exp - incurred at headquarters, charged back todivisions on the basis of usage: (WS) Division, $28,000; (SS)Division, $36,500.

b. Transportation Exp - charged back to divisions at a transfer price of $7.60 per bill of lading: (WS) Division, 6,000 bills of lading; (SS) Division, 7,250 bills of lading.

c. A/R Collection Exp - incurred at headquarters, charged back to divisions at a transfer price of $5.60 per invoice; (WS) Division,4,500 sales invoices; (SS) Division, 5,875 sales invoices.

d. Warehouse Exp - charged back to divisions on the basis of floor space used in storing division products: (WS) Division, 25,000 sqft; (SS) Division, 12,500 sq ft.

Prepare a division income statement with two column headings: (WS)Division and (SS) Division. Provide supporting schedules for determining service department charges.

Reference no: EM13482699

Questions Cloud

The company is expected to be in compliance with this : katherine company sales budget has thefollowing unit sales projections for each quarter of calendar

Determine the value-added non-value-added total lead times : rad technologies inc. is considering a new just-in-time product cell. the present manufacturing approach produces a

The zenith manufacturing corporation sells a certain : the zenith manufacturing corporation sells a certain product at a price of 50 each. the variable costs involved in the

The amount of increase or decrease in cost that is expected : the amount of increase or decrease in cost that is expected from a particular course of action as compared with an

Prepare a division income statement with two column : big bear athletic equipment co. operates two division - the winter sports division and the summer sports division. the

Sun estimates the fair value of the recourse liability at : sun inc. factors 2000000 of its accounts receivables with recourse for a finance charge of 3. the finance company

Marcel co is growing quickly dividends are expected to grow : marcel co. is growing quickly. dividends are expected to grow at a 24 percent rate for the next 3 years with the growth

Which of the following is an example of a cost that varies : which of the following is an example of a cost that varies in total as the number of units produced changes?a. salary

The controller of ferrence company estimates the amount of : the controller of ferrence company estimates the amount of materials handling overhead cost that should be allocated to

User Account

All Pages