Profit center responsibility reporting

A-One Freight Inc. has three regional divisions organized as profit centers. The chief executive officer (CEO) evaluates divisional performance, using income from operations as a percent of revenues. The following quarterly income and expense accounts were provided from the trial balance as of December 31, 20Y3.

Revenues- Air Division	$5,000,000
Revenues- Rail Division	6,000,000
Revenues-Truck Division	9,000,000
Operating Expenses-Air Division	4,100,000
Operating Expenses- Rail Division	4,900,000
Operating Expenses-Truck Division	7,555,000
Corporate Expenses-Shareholder Relations	220,000
Corporate Expenses-Customer Su pport	990,000
Corporate Expenses-Legal	880,000
General Corporate Officers'Salaries	500,000

The company operates three service departments: Shareholder Relations, Customer Support, and Legal. The Shareholder Relations Department conducts a variety of services for shareholders of the company. The Customer Support Department is the company's point of contact for new service, complaints, and requests for repair. The department believes that the number of customer contacts is an activity base for this work. The Legal Department provides legal services for division management. The department believes that the number of hours billed is an activity base for this work. The following additionall information has been gathered:

	Air	Rail	Truck
Number of customer contacts	1500	4500	16000
Number of hours billed	900	2400	6700

a. Prepare quarterly income statements showing income from operations for the three dicisions. Use three column headings: Air, Rail, and Truck.

b. Identify the most successful division according to the profit margin. Round to one decimal place.