Problem 09-3A Departmental income statements; forecasts LO P3 Williams Company began operations in January 2019 with two operating (selling) departments and one service (office) department. Its departmental income statements follow. WILLIAMS COMPANY Departmental Income Statements For Year Ended December 31, 2019 Clock Mirror Combined Sales $ 220,000 $125,000 $ 345,000 Cost of goods sold 107.800 77,500 185,300 Gross profit 112,200 47,500 159, 700 Direct expenses Sales salaries 21,500 8,580 38,000 Advertising 2.100 50 2,600 Store supplies used 850 550 1,400 Depreciation Equipment 2.100 600 2,700 Total direct expenses 26.550 10,150 36,700 Allocated expenses Rent expense 7,050 3,900 10,950 Utilities expense 2,300 2,400 4,700 Share of office department expenses 13,000 8,500 21,500 Total allocated expenses 22,350 14,800 37, 150 Total expenses 48.900 24,950 73,850 Net Income $63,300 $ 22,550 $ 85, 890 Williams plans to open a third department in January 2020 that will sell paintings, Management predicts that the new department will generate $49,000 in sales with o 45% gross profit margin and will require the following direct expenses: sales salaries, $8,500 advertising, $900; store supplies, $400, and equipment depreciation, $700. It will fit the new department into the current rented space by taking some square footage from the other two departments. When opened, the new Painting department will nil one-fifth of the space presently used by the Clock department and one fourth used by the Mirror department Management does not predict any Increase in utilities costs, which are allocated to the departments in proportion to occupied space for rent expense). The company allocates office department expenses to the operating departments in proportion to their sales. It expects the Painting department to increase total office department expenses by $7,400. Since the Painting department will bring new customers into the store. management expects sales in both the Clock and Mirror departments to increase by 13%. No changes for those departments' gross profit percents or their direct expenses are expected except for store supplies used, which will increase in proportion to sales. Required: Prepare departmental income statements that show the company's predicted results of operations for calendar-year 2020 for the three operating (selling) departments and their combined totals. (Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.) WILLIAMS COMPANY Forecasted Departmental Income Statements For Year Ended December 31, 2020 Clock Mirror Paintings Combined Direct expenses Total direct expenses Allocated expenses Total allocated expenses Total expenses