d Cathy's Classic Clothes is a retailer that sells to professional women in the northeast. The firm leases space for stores in upecale shopping centers, and the organizational structure consists of regions, districts, and stores. Esch region conte of two or more icta each strict consists of three or more stores. Each store d ict, and region has been establehed as a profit center At all levels, the company uses a responsibility Counting system focusing on information and knowledge rather than blame and control Each year, managers. In consultation with their supervisors, establish Financial and nonfinancial goals, and these goals are integrated into the budget Actual performances mesured each month The New England Region consists of the Coastal District and the Inand District. The Coastal District includes the New Haven, Bouton and Portland stores. The Coastal District's performance res not been up to expectations in the past. For the month of May the district marsger les set performance goes with the managers of the New Haven and Boston stres, who will receive bonuses for performance measures are exceeded. The manager in Portland decided not to participate in the bonus scheme. Since the d e manager is unsure what type of bonus wil encourage better performance, the New Havenmanager will receive a bonus based on sales in excess of budgeted sales of $580.000, while the Boston manager will receive a bonus based on operating income in exces of budget. The companys operating income goal for each stores 13 percent of sales. The budgeted sales revenue for the Boston store $540,000 Other pertinent dists for Mey are as follows: . Constel Diariet sales revenue was $1540,000, and cost of goods said mounted to $635450 . The Conturi pentS000 on advertising . General and min e expenses for the Coastal moted to $185.000 the New Haven store sales were 40 percent of Cont r oles, while sales at the Boston store were 35 percent of d e sales. The cost of goods sold in both New Haven and Boston 41 percent of sales Variable selling expenses les commissions were 7 percent of sales for stores, des, and regions Variable inste eenges were 24 percent of ses for stores. Oricts, and region . Maintenance Co Includes arts and repair services and surect cost for each store. The store magers complete control over this outy Maintenance Co were incurred as follows: New Haven, $7900, Boston, $900 and Polond, S4800 - Advertising is considered a direct cost for each store and completely under the control of the store mange The New Haven store spent two-thirds of the Coastal District total outlay for scivertising, which was times the amount spent in Boston on . Consta Dortrets expense amounted to $120.000 . The rental expenses at the New Haven store were 50 percent of the Coastal District's total, while the Boston por incurred 40 percent of the district tots District expenses were allocated to the stores based on sales New England Region general and administrative expenses of $165.000 were allocated to the Constitutrict. These expenses were, intum, located equally to the district's three stores. Required: 1. Prepare the May wegmented Income statement for the Coastal District and for the New Haven and Boston stores 2. Compute the Portland store's operating income for May 4. The assistant controller for the New England Region Jack Isner has been a close friend of the New Haven store manager for over 20 years. When Isner saw the segmented Income statement is prepared in requirement, he realized that the New Haven store manager had really gone overboard on advertising expenditures. To make his friend look better to the regional management, he reclassified $28,000 of the advertising expenditures as miscelaneous expenses, and burled them in rent and other costs. The assistant controller's actions volste several standards of ethical conduct for management accountants, including the following: Complete this question by entering your answers in the teba below. Red Rida Recured 4 Prepare Found in May i mediat salabona) t for Catalie and forew Haven and Besten eres. De net CAIRES CLASSIC CLOIS NUHI PASIRION For My Required 1 Required 2 Required 4 Compute the Portland store's operating income for May. Operating income Required 1 Required 2 Required 4 The assistant controller for the New England Region, Jack Isner, has been a close friend of the New Haven store manager for over 20 years. When Isner saw the segmented income statement (as prepared in requirement 1), he realized that the New Haven store manager had really gone overboard on advertising expenditures. To make his friend look better to the regional management, he reclassified $28,000 of the advertising expenditures as miscellaneous expenses, and buried them in rent and other costs. The assistant controller's actions violate several standards of ethical conduct for management accountants, including the following: (Select "Yes" if the assistant controller's actions violate several standards of ethical conduct, and "No" if it does not violate.) Show less Competence Integrity Credibility Controllability d Cathy's Classic Clothes is a retailer that sells to professional women in the northeast. The firm leases space for stores in upecale shopping centers, and the organizational structure consists of regions, districts, and stores. Esch region conte of two or more icta each strict consists of three or more stores. Each store d ict, and region has been establehed as a profit center At all levels, the company uses a responsibility Counting system focusing on information and knowledge rather than blame and control Each year, managers. In consultation with their supervisors, establish Financial and nonfinancial goals, and these goals are integrated into the budget Actual performances mesured each month The New England Region consists of the Coastal District and the Inand District. The Coastal District includes the New Haven, Bouton and Portland stores. The Coastal District's performance res not been up to expectations in the past. For the month of May the district marsger les set performance goes with the managers of the New Haven and Boston stres, who will receive bonuses for performance measures are exceeded. The manager in Portland decided not to participate in the bonus scheme. Since the d e manager is unsure what type of bonus wil encourage better performance, the New Havenmanager will receive a bonus based on sales in excess of budgeted sales of $580.000, while the Boston manager will receive a bonus based on operating income in exces of budget. The companys operating income goal for each stores 13 percent of sales. The budgeted sales revenue for the Boston store $540,000 Other pertinent dists for Mey are as follows: . Constel Diariet sales revenue was $1540,000, and cost of goods said mounted to $635450 . The Conturi pentS000 on advertising . General and min e expenses for the Coastal moted to $185.000 the New Haven store sales were 40 percent of Cont r oles, while sales at the Boston store were 35 percent of d e sales. The cost of goods sold in both New Haven and Boston 41 percent of sales Variable selling expenses les commissions were 7 percent of sales for stores, des, and regions Variable inste eenges were 24 percent of ses for stores. Oricts, and region . Maintenance Co Includes arts and repair services and surect cost for each store. The store magers complete control over this outy Maintenance Co were incurred as follows: New Haven, $7900, Boston, $900 and Polond, S4800 - Advertising is considered a direct cost for each store and completely under the control of the store mange The New Haven store spent two-thirds of the Coastal District total outlay for scivertising, which was times the amount spent in Boston on . Consta Dortrets expense amounted to $120.000 . The rental expenses at the New Haven store were 50 percent of the Coastal District's total, while the Boston por incurred 40 percent of the district tots District expenses were allocated to the stores based on sales New England Region general and administrative expenses of $165.000 were allocated to the Constitutrict. These expenses were, intum, located equally to the district's three stores. Required: 1. Prepare the May wegmented Income statement for the Coastal District and for the New Haven and Boston stores 2. Compute the Portland store's operating income for May 4. The assistant controller for the New England Region Jack Isner has been a close friend of the New Haven store manager for over 20 years. When Isner saw the segmented Income statement is prepared in requirement, he realized that the New Haven store manager had really gone overboard on advertising expenditures. To make his friend look better to the regional management, he reclassified $28,000 of the advertising expenditures as miscelaneous expenses, and burled them in rent and other costs. The assistant controller's actions volste several standards of ethical conduct for management accountants, including the following: Complete this question by entering your answers in the teba below. Red Rida Recured 4 Prepare Found in May i mediat salabona) t for Catalie and forew Haven and Besten eres. De net CAIRES CLASSIC CLOIS NUHI PASIRION For My Required 1 Required 2 Required 4 Compute the Portland store's operating income for May. Operating income Required 1 Required 2 Required 4 The assistant controller for the New England Region, Jack Isner, has been a close friend of the New Haven store manager for over 20 years. When Isner saw the segmented income statement (as prepared in requirement 1), he realized that the New Haven store manager had really gone overboard on advertising expenditures. To make his friend look better to the regional management, he reclassified $28,000 of the advertising expenditures as miscellaneous expenses, and buried them in rent and other costs. The assistant controller's actions violate several standards of ethical conduct for management accountants, including the following: (Select "Yes" if the assistant controller's actions violate several standards of ethical conduct, and "No" if it does not violate.) Show less Competence Integrity Credibility Controllability