Exercise 24-6 (Algo) Departmental expense allocations LO P2 Gomez Company has two service departments (Personnel and Office) and two operating departments (Shoes and Clothing). Following are the direct expenses and square feet occupied by the four departments, and the total sales for the two operating departments. Department Direct Expenses Square Feet Sales Personnel $ 18, 000 300 office 38 , 000 350 Shoes 128 , 000 2, 300 $ 238, 000 Clothing 16 , 000 2 , 050 102 , 000 The company also has $63,000 of utilities expense, which is an indirect expense to all departments and is allocated to the four departments based on square feet occupied. The Shoes department has 54 employees and the Clothing department has 126 employees. Personnel expense is allocated to operating departments based on the number of employees. Office expense is allocated to operating departments based on sales. 1. Allocate utilities expense to the four departments. 2. Allocate personnel expense to the Shoes and Clothing departments. 3. Allocate office expense to the Shoes and Clothing departments. Cost to be Utilities Allocation Base Percent of Allocation Base Allocated Allocated Cost Department Numerator Denominator % of Total Personnel Office Shoes Clothing Totals Cost to be Personnel expense Allocation Base Percent of Allocation Base Allocated Allocated Cost Department Numerator Denominator % of Total Shoes Clothing Totals Cost to be fice expense Allocation Base Percent of Allocation Base Allocated Allocated Cost Department Numerator Denominator % of Total Shoes Clothing TotalsBelow 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 Acoustic Electric Sales $ 101,600 $ 83,500 Cost of goods sold 43,975 47,250 Gross profit 57,625 36,250 Expenses Advertising 5,025 4,320 DepreciationEquipment 10,090 8,510 Salaries 20,200 17,000 Supplies used 2,000 1,770 Rent 7,025 6,010 Utilities 3,045 2,600 Total expenses 47,385 40,210 Income (loss) $ 10,240 $ (3,960) 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. Gross prot Direct expenses Departmentscontn-bulonmovemead __ Required 2 > Exercise 24-7 (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 Acoustic Electric Sales $ 101,600 $ 83,500 Cost of goods sold 43,975 47,250 Gross profit 57,625 36,250 Expenses Advertising 5,025 4,320 DepreciationEquipment 10,090 8,510 Salaries 20,200 17,000 Supplies used 2,000 1,770 Rent 7,025 6,010 Utilities 3,045 2,600 Total expenses 47,385 40,210 Income (loss) $ 10,240 $ (3,960) 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 Based on contribution to overhead, should the electric guitar department be eliminated? Based on contribution to overhead, should the electric guitar department be eliminated? I I