Arlington Clothing, Inc., shows the following information for its two divisions for year 1.

	Lake Region			Coastal Region
Sales revenue	$	4,210,000		$	13,120,000
Cost of sales		2,716,300			6,560,000
Allocated corporate overhead		252,600			787,200
Other general and administration		558,900			3,760,000

Required:

a. Compute divisional operating income for the two divisions. Ignore taxes.

b-1. What are the gross margin and operating margin percentages for both divisions?

b-2. How well have these divisions performed?