Regal Rooms Ltd is a rug and drapery retailer. Regal Rooms specialises in selling floor rugs and window dressings. The following information was derived from the shop’s accounting records for the year ended 30 June 2025.

Required

(a) Prepare a departmental statement of financial performance showing the departmental gross profit for each department and the store’s profit for the year.

(b) Calculate the gross profit percentage for each department.

(c) Prepare a departmental statement of financial performance that shows the profit of each department after the indirect expenses are allocated on the basis of gross profit.

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Net sales Purchases Purchase returns Direct expenses 3 600 156 000 Floor rugs $ 582 000 259 200 Window dressings $ 506 000 328 320 3 800 78 500 Inventory, 1 July 2024 193 400 149 200 Inventory, 30 June 2025 202 600 148 900 Indirect expenses are $146 800 per year.