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Garcia Company has two operating departments (Phone and Earbuds) and one service department (Office). Its departmental Income statements follow. Indirect expenses and service department expenses
Garcia Company has two operating departments (Phone and Earbuds) and one service department (Office). Its departmental Income statements follow. Indirect expenses and service department expenses consist of rent, utilities, and office department expenses. Sales Cost of goods sold Gross profit Expenses Sales salaries Supplies used Depreciation-Equipment Rent Utilities GARCIA COMPANY Departmental Income Statements For Year Ended December 31 Share of office department expenses Total expenses Income Phone 116,400 $ 150,000 Earbuds $ 105,000 Combined 73,500 65,100 $ 255,000 138,600 76,500 39,900 21,500 7,100 28,600 1,150 400 1,550 2,400 500 2,900 7,100 3,600 10,700 2,900 1,400 4,300 12,000 5,000 47,050 18,000 $ 29,450 $ 21,900 17,000 65,050 $ 51,350 Required: Prepare a departmental contribution to overhead report. Garcia Company Departmental Contribution to Overhead For Year Ended December 31 Direct expenses Total direct expenses Departmental contribution to overhead Phone Earbuds Combined
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