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Below are departmental income statements for a guitar manufacturer. The manufacturer is considering eliminating its electric guitar department since it has a net loss. The
Below are departmental income statements for a guitar manufacturer. The manufacturer is considering eliminating its electric guitar department since it has a net loss. The company classifies advertising, rent, and utilities expenses as indirect. WHOLESALE GUITARS Departmental Incon Statements Por Year Unded December 31, 2017 heountie intrid Sales $102,900 393,100 Cost of goods sold 44,225 46,850 Gross profit 58,525 36,250 Operating expenses Advertising expense 5,025 6,350 Depreciation expense equipment 10,050 8.600 salaries expense 20,300 17.300 Supplies expense 2.020 1.740 Rent expense 7,055 6,010 Utilities expense 3,025 2,620 Total operating expenses 47,475 40,620 Net incon (los) 3.11.050 14,370) 1. Prepare a departmental contribution report that shows each department's contribution to overhead. WHOLESALE GUITARS Income Statement Showing Departmental Contribution to Overhead For Your Ended December 31, 2017 Acoustic Dept. Electric Dept Combined Direct expenses 1. Prepare a departmental contribution report that shows each department's contribution to overhead. WHOLESALE GUITARS Income Statement Showing Departmental Contribution to Overhead For Year Endod December 31, 2017 Acoustic Dept. Electric Dept. Combined Direct expenses 5 Total direct expenses Departmental contributions to overhead Indirect expenses Total indirect expenses
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