Exercise 22-7 (Algo) Departmental contribution to overhead LO P3 Below are departmental income statements for a guitar manufacturer. The company classifies advertising, rent, and utilities as indirect expenses. The manufacturer is considering eliminating its Electric Guitar department because it shows a loss. Departmental Income Statements For Year Ended December 31 Sales Cost of goods sold Gross profit Expenses Advertising Depreciation-Equipment Salaries Supplies used Rent Utilities Total expenses Acoustic Electric $ 103,100 43,775 $ 83,400 47,350 59,325 36,050 5,045 4,300 10,140 8,520 19,400 17,200 2,020 1,710 7,025 6,010 3,045 2,610 46,675 40,350 Income (loss) $ 12,650 $ (4,300) 1. Prepare a departmental contribution to overhead report. 2. Based on contribution to overhead, should the electric guitar department be eliminated? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a departmental contribution to overhead report. Departmental Contribution to Overhead For Year Ended December 31 Gross profit Direct expenses otal direct expenses Departmental contribution to overhead Acoustic Electric Combined Required 2 < Prev 5 of 18 Next >