Dee Corporation is one of the major producers of pre-fabricated houses in the home building industry. The corporation consists of two divisions: 1.Bell Division, which acquires the raw materials to manufacture the basic house components and assembles them into kits. 2.Cornish Division, which takes the kits and constructs the homes for final home buyers. The corporation is decentralized and the management of each division is measured by its income and return on investment. Bell Division assembles seven separate house kits using raw materials purchased at the prevailing market prices. The seven kits are sold to Cornish for prices ranging from US$45,000 to US$98,000. The prices are set by corporate management of value.

Using the annual report presented for Bell Division, evaluate the division and its management in terms of: i.The accounting techniques employed in the measurement of division activities ii.The manner of presentation iii.The effectiveness with which it discloses difference and similarities between years

Summary Data Bell Division Performance Report for the Year Ended December 31, 2021 2021 2020 Net Income ($000 omitted) Return on Investment (ROI) Kits sold (units) Production Data Kits started Kits transferred to Cornish Div. Kits in process at year-end Increase (Decrease) in kits in process at year-end Financial Data ($000) Sales Production costs of units sold Raw material Labor Factory overhead Cost of units sold Other Costs: Corporate Charges for Personnel services Accounting services Financing costs Total other costs Adjustments to Income Unreimbursed fire loss Raw material losses due to Total adjustments Total Costs DIVISION INCOME Division Investment ROI improper storage $34,222 37% 2,000 2,400 2,000 700 400 $138,000 32,000 41,700 29,000 $102,700 228 425 300 $953 0 125 $125 $103,778 $34,222 $92,000 37% Increase/(Decrease) from 2020 AMOUNT % CHANGE $31,573 $2,649 8.4 43% (6%) (14.0) 2,100 (100) (4.8) 1,600 800 50.0 2,100 (100) (4.8) 300 400 133.3 (500) $162,800 ($24,800) (15.2) 40,000 (8,000) (20.0) 53,000 (11,300) (21.3) 37,000 (8,000) (21.6) $130,000 ($27,300) (21.0) 210 18 8.6 440 (15) (3.4) 525 (225) (42.9) $1,175 ($222) (18.9) 52 (52) (100.0) 0 125 $52 $73 (100.0) $131,227 ($27,449) (20.9) $31,573 $2,649 8.4 $73,000 $19,000 26.0 43% (6%) (14.0)