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, 20Y7, are as follows:

Tech Services Department	$1,003,200
Purchasing Department	261,000
Other corporate administrative expenses	544,000
Total expense	$1,808,200

The other corporate administrative expenses include officers salaries and other expenses required by the corporation. The Tech Services Department allocates costs 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:

	Tech Services		Purchasing
Consumer Division	350	computers	6,100	purchase orders
Commercial Division	220		11,300
Total	570	computers	17,400	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
Revenues	$8,320,500		$6,451,100
Cost of goods sold	4,622,500		3,257,500
Operating expenses	1,632,100		1,612,600

Prepare the divisional income statements for the two divisions. Do not round your interim calculations.

Horton Technology
Divisional Income Statements
For the Year Ended December 31, 20Y7
		Consumer Division		Commercial Division
Revenues		$fill in the blank 2		$fill in the blank 3
Cost of goods sold		fill in the blank 5		fill in the blank 6
Gross profit		$fill in the blank 8		$fill in the blank 9
Operating expenses		fill in the blank 11		fill in the blank 12
Operating income before support department allocations		$fill in the blank 13		$fill in the blank 14
Support department allocations:
Tech service department		$fill in the blank 16		$fill in the blank 17
Purchasing department		fill in the blank 19		fill in the blank 20
Total support department allocations		$fill in the blank 21		$fill in the blank 22
Operating income		$fill in the blank 24		$fill in the blank 25