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. GARCIA COMPANY Departmental Income Statements For Year Ended December 31 Sales Cost of goods sold Gross profit Expenses Sales salaries Supplies used Depreciation-Equipment Rent Utilities Share of office department expenses Total expenses Income Phone Earbuds Combined $ 260,000 127,400 $ 95,000 $ 355,000 58,900 186,300 132,600 36,100 168,700 22,000 7,800 29,800 900 750 1,650 1,500 500 2,000 7,110 3,840 10,950 2,300 2,300 4,600 11,000 5,000 16,000 44,810 20,190 65,000 $ 87,790 $ 15,910 $ 103,700