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 Electric $84,000 47, 450 36,558 WHOLESALE GUITARS Departmental Income Statements For Year Ended December 31, 2019 Acoustic Sales $183,400 Cost of goods sold 44,675 Gross profit 58,725 Operating expenses Advertising expense 4,995 Depreciation expense-Equipment 10,120 Salaries expense 19,900 Supplies expense 1,970 Rent expense 7, 045 utilities expense 3,015 47,845 Total operating expenses $ 11,680 Net income (loss) 4.340 8,590 17,100 1,790 5,960 2,630 40,410 $(3,860) 1. Prepare a departmental contribution report that shows each department's contribution to overhead. 2. Based on contribution to overhead, should the electric guitar department be eliminated? 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 Income Statements For Year Ended December 31, 2019 Acoustic Electric Sales $183,400 584,000 Cost of goods sold 44,675 47.450 Gross profit 58,725 36,550 Operating expenses Advertising expense 4,995 4,340 Depreciation expense-Equipe 10.120 8,590 Salaries expense 19,900 17,180 Supplies expense 1,970 1,790 Hent expense 7,045 5,960 utilities expense 2,630 Total operating expenses 47.045 Net Incos (less) $ 11,680 563,860) 1. Prepare a departmental contribution report that shows each department's contribdtion to overhead 2. Based on contribution to overhead, should the electric guitar department be eliminated? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a departmental contribution report that shows each department's contribution to overhead 1. Prepare a departmental contribution report that shows each department's contribution to overhead. 2. Based on contribution to overhead, should the electric guitar department be eliminated? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a departmental contribution report that shows each department's contribution to overhead. WHOLESALE GUITARS Income Statement Showing Departmental Contribution to Overhead For Year Ended December 31, 2019 Acoustic Dept. Electric Dept. Combined Direct expenses 0 0 0 40 $ 0 $ Total direct expenses Departmental contributions to overhead
