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Dunnes Stores has two service department, Advertising and Administration, and two operating departments, Hardware and Automotive. Sales, COGS, and direct expenses are given below. Complete

Dunnes Stores has two service department, Advertising and Administration, and two operating departments, Hardware and Automotive. Sales, COGS, and direct expenses are given below. Complete the following table, including allocation of $220,000 of indirect costs. Indirect costs are allocated on the basis of square footage:Advertising Department:750 square feet, Administration Department:1,500 square feet, Hardware Department:3,000 square feet, Automotive Department:9,750 square feet

Dunnes Stores

Revenues and Expenses

Y/E December 31, 2018

Service Departments

Operating Departments

Totals

Advertising

Admin

Hardware

Automotive

Sales

1,500,000

$675,000

$825,000

COGS

375,000

100,000

275,000

Direct Expenses

275,000

50,000

100,000

50,000

75,000

Indirect Expenses

220,000

Totals

Allocated Service Dept. Expenses

Dept. Name

Dept. Name

Total Expenses Allocated to Operating Depts.

Use the table above to allocate the service department expenses to the operating departments. Advertising Costs are allocated on the basis of number of advertisements in each department. Hardware had 60 ads and Automotive had 90. Administrative costs are allocated on the basis of sales. Complete the following Departmental Income Statement

Dunnes Stores

Departmental Income Statement

Y/E December 31, 2018

Hardware

Automotive

Combined

Sales

Cost of Goods Sold

Gross Profit

Operating Expenses

Direct Expenses

Indirect Expenses

Share of Advertising Expenses

Share of Admin Expenses

Total Operating Expenses

Operating Income (Loss)

Complete the following Income Statement showing Departmental Contribution to Overhead

Dunnes Stores

Income Statement Showing Departmental Contribution to Overhead

Y/E December 31, 2018

Hardware

Housewares

Combined

Sales

Cost of Goods Sold

Gross Profit

Direct Expenses

Departmental Contribution to Overhead

Indirect Expenses

Share of Advertising Expenses

Share of Administrative Expenses

Total Operating Expenses

Operating Income (Loss)

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