EX 24-9 Profit center responsibility reporting Glades Sporting Goods Co. operates two divisions the Winter Sports Division 08).3 rom Summer ion, Summer Sports Division. The following income and expense accounts were p the trial balance as of December 31, 20Y8, the end of the fiscal year, after all adided from including those for inventories, were recorded and posted: provided from adjustments Chapter 24 Decentralized Operations Sales-Winter Sports Division $12,600,000 16,300,000 7,560,000 9,454,000 2,016,000 Sales- Summer Sports Division Cost of Goods Sold-Winter Sports Division Cost of Goods Sold-Summer Sports Division. Sales Expense-Winter Sports Division Sales Expense-Summer Sports Division 2,282,000 1,260,000 1,450,700 578,000 Administrative Expense-Winter Sports Division Administrative Expense-Summer Sports Division. Advertising Expense Transportation Expense 265,660 174,000 1,540,000 Accounts Receivable Collection Expense .. .. . Warehouse Expense The bases to be used in allocating expenses, together with other essential information, are as follows: a. Advertising expense-incurred at headquarters, charged back to divisions on the basis of usage: Winter Sports Division, $252,000; Summer Sports Division, $326,000. b. Transportation expense-charged back to divisions at a charge rate of $7.40 per bill of lading: Winter Sports Division, 17,200 bills of lading; Summer Sports Division, 18,700 bills of lading. 8 c. Accounts re ceivable collection expense-incurred at headquarters, charged back to divisions at a charge rate of $6.00 per invoice: Winter Sports Division, 11,500 sales invoices; Summer Sports Division, 17,500 sales invoices Warehouse expense-charged back to divisions on the basis of floor space used in storing division products: Winter Sports Division, 102,000 square feet, Summer Sports Division, 118,000 square feet. Prepare a divisional income statement with two column headings: Winter Sports Division and Summer Sports department charges Division. Provide supporting calculations for service For the Year Ended December 31, 20Y8 Sports Division Sports Division Sales Cost of goods sold Gross proft Divisional expenses: Divisional selling expenses Divisional administrative expenses Total Income from operations before service department charges Less service department charges: Advertising expense Transportation expense Accounts receivable collection expense Warehouse expense Total Income from operations Supporting schedule: Service Department Charges Winter Sports Division Sports Division Advertising expense Number of bills of lading Transportation rate per bill of lading Transportation expense Number of sales invoices Accounts recievable collection rate Accounts receivable collection expense Number of warehouse square feet Warehouse rate per square foot Warehouse expense Ex. 24-9 : +
