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 $ 84,700 47,350 37,350 WHOLESALE GUITARS Departmental Income Statements For Year Ended December 31, 2017 Acoustic Sales $103,200 Cost of goods sold 43, 775 Gross profit 59,425 Operating expenses Advertising expense 5,045 Depreciation expense-equipment 10,110 Salaries expense 19,900 Supplies expense 2,000 Rent expense 7,105 Utilities expense 3,005 Total operating expenses 47,165 Net income (loss) $ 12,260 4,330 8,510 17,700 1,780 6,010 2,560 40,890 $ (3,540) 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 Ended December 31, 2017 Acoustic Dept. Electric Dept. Combined Direct expenses Total direct expenses Departmental contributions to overhead Indirect expenses Total indirect expenses 2. Based on contribution to overhead, should the electric guitar department be eliminated? O No O Yes