Billie Whitehorse, the plant manager of Travel Free's Indiana plant, is responsible for all of that plant's costs other than her own salary. The plant has two operating departments and one service department. The camper and trailer operating departments manufacture different products and have their own managers. The office department, which Whitehorse also manages, provides services equally to the two operating departments. A budget is prepared for each operating department and the office department. The company's responsibility accounting system must assemble information to present budgeted and actual costs in performance reports for each operating department manager and the plant manager. Each performance report includes only those costs that a particular operating department manager can control: raw materials, wages, supplies used, and equipment depreciation. The plant manager is responsible for the department managers' salaries, utilities, building rent, office salaries other than her own, and other office costs plus all costs controlled by the two operating department managers. The annual departmental budgets and actual costs for the two operating departments follow. Budget Actual Campers Trailers Combined Raw materials 195,300 $278,200 $473,500 $ Campers Trailers Combined 194,900 $274,400 $469,300 105,750 205,400 106,400 Employee wages 311,150 207,200 313,600 Dept. manager 43,200 52,200 95,400 44,300 53,100 97,400 salary Supplies used 34,000 92,000 126,000 32,600 91,300 123,900 Depreciation- 125,500 62,000 187,500 63,000 126,000 189,000 Equip. Utilities 4,200 6,000 10,200 4,200 5,600 9,800 Building rent 6,300 9,900 16,200 6,200 8,900 15,100 Office 66,750 66,750 133,500 79,550 79,550 159,100 department costs Totals $517,500 $835,950 $1,353,450 $531,150 $846,050 $1,377,200 The office department's annual budget and its actual costs follow. Budget Actual Plant manager salary Other office salaries 30,500 Other office costs Totals $81,000 $99,000 26,200 22,000 33,900 $133,500 159,100 Required: 1. Prepare responsibility accounting performance reports that list costs controlled by the following. In each report, include the budgeted and actual costs and show the amount that each actual cost is over or under the budgeted amount. a. Manager of the camper department. Responsibility Accounting Performance Report Dept. Manager, Camper Department For the Year Over Budgeted Actual (Under) Amount Amount Budget Controllable Costs Totals b. Manager of the trailer department. Responsibility Accounting Performance Report Dept. Manager, Trailer Department For the Year Over Budgeted Actual Amount Amount (Under) Budget Controllable Costs Totals c. Manager of the Indiana plant. Responsibility Accounting Performance Report Plant Manager, Indiana Plant For the Year Over Budgeted Actual (Under) Amount Amount Budget Controllable Costs Totals Williams Company began operations in January 2015 with two operating (selling) departments and one service (office) department. Its departmental income statements follow. WILLIAMS COMPANY Departmental Income Statements For Year Ended December 31, 2015 Clock Mirror Combined Sales $200,000 $85,000 $285,000 Cost of goods sold 98,000 52,700 150,700 Gross profit 102,000 32,300 134,300 Direct expenses Sales salaries 22,000 6,900 28,900 Advertising 1,600 700 2,300 Store supplies used 850 400 1,250 Depreciation- 1,500 400 1,900 Equipment Total direct expenses 25,950 8,400 34,350 Allocated expenses Rent expense 7,070 4,020 11,090 Utilities expense 2,400 2,100 4,500 Share of office department expenses 13,000 5,000 18,000 Total allocated 22,470 11,120 33,590 expenses Total expenses 48,420 19,520 67,940 Net income $ 53,580 $12,780 $ 66,360 Williams plans to open a third department in January 2016 that will sell paintings. Management predicts that the new department will generate $58,000 in sales with a 95% gross profit margin and will require the following direct expenses: sales salaries, $7,500; advertising, $1,100; store supplies, $500; and equipment depreciation, $500. It will fit the new department into the current rented space by taking some square foot-age from the other two departments. When opened the new painting department will fill one-fifth of the space presently used by the clock department and one-fourth used by the mirror department. Management does not predict any increase in utilities costs, which are allocated to the departments in proportion to occupied space (or rent expense). The company allocates office department expenses to the operating departments in proportion to their sales. It expects the painting department to increase total office department expenses by $7,400. Since the painting department will bring new customers into the store, management expects sales in both the clock and mirror departments to increase by 7%. No changes for those departments' gross profit percents or their direct expenses are expected except for store supplies used, which will increase in proportion to sales. Required: Prepare departmental income statements that show the company's predicted results of operations for calendar year 2016 for the three operating (selling) departments and their combined totals. (Do not round intermediate calculations. Round your final answer to nearest whole dollar amount.) WILLIAMS COMPANY Forecasted Departmental Income Statements For Year Ended December 31, 2016 Clock Mirror Paintings Combined Direct expenses Total direct expenses Allocated expenses Total allocated expenses Total expenses