Divisional Income Statements with Support Department Allocations Horton Technology has two divisions, Consumer and Commercial, and two corporate support departments, Tech Services and Purchasing. The corporate expenses for the year ended December 31, 2017, are as follows: Tech Services Department Purchasing Department Other corporate administrative expenses Total expense $1,170,000 450,000 800,000 $2,420,000 The other corporate administrative expenses include officers' salaries and other expenses required by the corporation. The Tech Services Department allocates couts to the divisions based on the number of computers in the department, and the Purchasing Department allocates costs to the divisions based on the number of purchase orders for each department The services used by the two divisions are as follows: Consumer Division Commercial Division Total Tech Services 1,100 computers 700 1,800 computers Purchasing 4,000 purchase orders 8,000 12,000 purchase orders The support department allocations of the Tech Services Department and the Purchasing Department are considered controllable by the divisions Corporate administrative expenses are not considered controllable by the divisions. The revenues, cost of goods sold, and operating expenses for the two divisions are as follows: Consumer Commercial Previous Tech Services Consumer Division 1,100 computers Purchasing 4,000 purchase orders 8,000 12,000 purchase orders Commercial Division 700 Total 1,800 computers The support department allocations of the Tech Services Department and the Purchasing Department are considered controllable by the divisions Corporate administrative expenses are not considered controllable by the divisions. The revenues, cost of goods sold, and operating expenses for the two divisions are as follows: Consumer Revenues Commercial $33,250,000 15,800,000 1,750,000 $15,500,000 10,000,000 3,000,000 Cost of goods sold Operating expenses Prepare the divisional income statements for the two divisions. Round your interim calculations to three decimal places, if required. Horton Technology Divisional Income Statements For the Year Ended December 31, 2017 Consumer Division Commercial Division Operating expenses 3,000,000 1,750,000 Prepare the divisional income statements for the two divisions. Round your interim calculations to three decimal places, if required. Horton Technology Divisional Income Statements For the Year Ended December 31, 2017 Consumer Division Commercial Division Operating income before support department allocations Support department allocations: ID QUOD 0000 DODO Total support department allocations
