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Prepare the divisional income statements for the two divisions. Refer to the list of Labels and Amount Descriptions for the exact wording of the answer
Prepare the divisional income statements for the two divisions. Refer to the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries.
Yozamba Technology has two divisions, Consumer and Commercial, and two corporate service departments, Tech Support and Purchasing. The corporate expenses for the year ended December 31, 2016, are as follows: $492.000 Tech Support Department Purchasing Department 75.600 Other corporate administrative expens s 575.000 Total corporate expense S1,142,600 The other corporate administrative expenses include officers' salaries and other expenses required by the corporation. The Tech Support Department charges the divisions for services rendered, based on the number of computers in the department, and the Purchasing Department charges divisions for services, based on the number of purchase orders for each department. The usage of service by the two divisions is as follows: Tech Support Purchasing Consumer Drvision 340 computers 1,930 purchase orders Commercial Divison 260 3470 600 oomputers 5 400 purchase orders The service department charges of the Tech Support Department and the Purchasing Department are considered controllable by the divisions. Corporate administrative expenses are not considered controllable by the divisions. The revenues, cost of goods sold, and operating expenses for the two divisions are as follows: Consumer Commercia Revenues $7,460,000 $6,180,000 Cost of goods sold 4,112,000 3,122,500 operating expenses 1,462,000 1,549,500 Prepare the divisional income statements for the two divisions. Refer to the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entriesStep by Step Solution
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