Profit Center Responsibility Reporting

Championship Sports Inc. operates two divisionsthe Winter Sports Division and the Summer Sports Division. The following income and expense accounts were provided from the trial balance as of December 31, 20Y9, the end of the fiscal year, after all adjustments, including those for inventories, were recorded and posted:

SalesWinter Sports Division	$31,920,000
SalesSummer Sports Division	35,264,000
Cost of Goods SoldWinter Sports Division	19,152,000
Cost of Goods SoldSummer Sports Division	20,368,000
Sales ExpenseWinter Sports Division	5,472,000
Sales ExpenseSummer Sports Division	4,864,000
Administrative ExpenseWinter Sports Division	3,192,000
Administrative ExpenseSummer Sports Division	3,131,200
Advertising Expense	961,000
Transportation Expense	401,700
Accounts Receivable Collection Expense	267,300
Warehouse Expense	3,040,000

The bases to be used in allocating expenses, together with other information, are as follows:

1. Advertising expenseincurred at headquarters, allocated to divisions on the basis of usage: Winter Sports Division, $451,000; Summer Sports Division, $510,000.
2. Transportation expenseallocated to divisions at a rate of $13 per bill of lading: Winter Sports Division, 14,700 bills of lading; Summer Sports Division, 16,200 bills of lading.
3. Accounts receivable collection expenseincurred at headquarters, allocated to divisions at a rate of $9 per invoice: Winter Sports Division, 13,700 sales invoices; Summer Sports Division, 16,000 sales invoices.
4. Warehouse expenseallocated to divisions on the basis of floor space used in storing division products: Winter Sports Division, 170,000 square feet; Summer Sports Division, 210,000 square feet.

Prepare a divisional income statement with two column headings: Winter Sports Division and Summer Sports Division. Do not round your interim calculations.

Championship Sports Inc.
Divisional Income Statements
For the Year Ended December 31, 20Y9
	Winter Sports Division	Summer Sports Division
Sales	$	$
Cost of goods sold
Gross profit	$	$
Divisional selling and administrative expenses:
Divisional selling expenses	$	$
Divisional administrative expenses
Total divisional selling and administrative expenses	$	$
Operating income before support department allocations	$	$
Support department allocations:
Advertising expense	$	$
Transportation expense
Accounts receivable collection expense
Warehouse expense
Total support department allocations	$	$
Operating income	$	$

Feedback

For each division: Sales minus cost of goods sold equals gross profit minus divisional selling and administrative expenses equals operating income before support department allocations. Support department allocations are subtracted from operating income before support department allocations.

Provide supporting schedules for determining support department allocations. If required, round per unit amounts to two decimal places and final answers to the nearest dollar.

Championship Sports Inc.
Support Department Allocations
For the Year Ended December 31, 20Y9
	Winter Sports Division	Summer Sports Division	Total
Advertising expense	$	$	$
Transportation rate per bill of lading	$	$
Number of bills of lading
Transportation expense	$	$	$
Accounts receivable collection rate	$	$
Number of sales invoices
Accounts receivable collection expense	$	$	$
Warehouse rate per sq. ft.	$	$
Number of square feet
Warehouse expense	$	$	$