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Profit Center Responsibility Reporting for a Service Company operations as a percent of revenues. The following quarterly income and expense accounts were provided from the
Profit Center Responsibility Reporting for a Service Company operations as a percent of revenues. The following quarterly income and expense accounts were provided from the trial balance as of December 31 : 1. Prepare quarterly income statements showing income from operations for the three regions. Use three column headings: North, South, and West. Do not round your interim calculations. 2. What is the profit margin of each division? Round to one decimal place. Identify the most successful region according to the profit margin. 3. What would you include in a recommendation to the CEO for a better method for evaluating the performance of the divisions? a. The method used to evaluate the performance of the divisions should be reevaluated. b. A better divisional performance measure would be the rate of return on investment (income from operations divided by divisional assets). c. A better divisional performance measure would be the residual income (income from operations less a minimal return on divisional assets). d. None of these choices would be included. e. All of these choices ( a, b \& c) would be included
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