Exercise 22-7 Departmental contribution report LO P3 Below are departmental income statements for a guitar manufacturer. The manufacturer is considering eliminating its electric guitar department since it has a net loss. The company classifies advertising, rent, and utilities expenses as indirect. WHOLESALE GUITARS Departnental Income Statements For Year Ended December 31, 2017 Acoustic Electric Sales Cost of goods sold Gross profit Operating expenses $103, 000 S84, 700 45,375 47,050 57,625 37,650 Advertising expense Depreciation expense-equipment Salaries expense Supplies expense Rent expense Utilities expense 4, 975 4,320 10, 1008,560 20, 100 37,300 1,9901750 5, 960 7,025 2, 985 Total operating expenses Net incone (Loss) 40, 460 10,450 $(2,810) Prepare a departmental contribution ,eport that shows each department's contribution to overhead WHOLESALE GUITARS Income Statement Showing Departmental Contribution to Overhead For Year Ended December 31, 2017 Acoustic Dept. Electric Dept. Combined Direct expenses 5 Total direct expenses Departmental contributions to overhead Indirect expenses Acoustic Dept. Electric Dept. Combined Direct expenses Total direct expenses Departmental contributions to overhead Indirect expenses Total indirect expenses 1. Prepare a departmental contribution report that shows each department's contribution to overhead. WHOLESALE GUITARS Income Statement Showing Departmental Contribution to Overhead For Year Ended December 31, 2017 Acoustic Dept. Electric Dept. Combined Direct expenses Total direct expenses Departmental contributions to overhead Indirect expenses