Carry On Freight Inc. has three regional divisions organized as profit centers. The chief executive officer (CEO) evaluates divisional performance using operating income as a percent of revenues. The following quarterly income and expense accounts were provided from the trial balance as of December 31, 20Y3. RevenuesAir Division $ 860,000 RevenuesRail Division 1,024,100 RevenuesTruck Division 1,776,800 Operating ExpensesAir Division 545,000 Operating ExpensesRail Division 609,500 Operating ExpensesTruck Division 1,074,500 Corporate ExpensesShareholder Relations 130,800 Corporate ExpensesCustomer Support 394,800 Corporate ExpensesLegal 234,600 General Corporate Officers' Salaries 288,900 The company operates three service departments: Shareholder Relations, Customer Support, and Legal. The Shareholder Relations Department conducts a variety of services for shareholders of the company. The Customer Support Department is the company's point of contact for new service, complaints, and requests for repair. The department believes that the number of customer contacts is an activity base for this work. The Legal Department provides legal services for division management. The department believes that the number of hours billed is an activity base for this work. The following additional information has been gathered: Air Rail Truck Number of customer contacts 4,700 5,600 8,500 Number of hours billed 1,200 1,800 1,600 Division management does not control activities related to the shareholder relations department and general corporate officers' salaries. Required: Question Content Area 1. Prepare quarterly income statements showing operating income for the three divisions. Use three column headings: Air, Rail, and Truck. Carry On Freight Inc. Divisional Income Statements For the Quarter Ended December 31, 20Y3 Air Rail Truck Revenues $Revenues 860,000 $Revenues 1,024,100 $Revenues 1,776,800 Operating expenses Operating expenses 545,000 Operating expenses 609,500 Operating expenses 1,074,500 Operating income before service department charges $Operating income before service department charges 315,000 $Operating income before service department charges 414,600 $Operating income before service department charges 702,300 Less service department charges: Customer support $Customer support $Customer support $Customer support Legal Legal Legal Legal Total service department charges $fill in the blank a7b6f20a9019fbf_21 $fill in the blank a7b6f20a9019fbf_22 $fill in the blank a7b6f20a9019fbf_23 Operating income $fill in the blank a7b6f20a9019fbf_24 $fill in the blank a7b6f20a9019fbf_25 $fill in the blank a7b6f20a9019fbf_26 Question Content Area 2. What is the profit margin percentage of each division? Round to one decimal place. Division Profit Margin Air Division fill in the blank c3ba09f84005065_1 % Rail Division fill in the blank c3ba09f84005065_2 % Truck Division fill in the blank c3ba09f84005065_3 %