Profit Center Responsibility Reporting for a Service Company Thomas Railroad Company organizes its three divisions, the North (N), South (S), and West (W) regions, as profit centers. The chief executive officer (CEO) evaluates divisional performance, using operating income as a percent of revenues. The following quarterly income and expense accounts were provided from the trial balance as of December 31: Revenues-N Region $1,015,300 Revenues-5 Region 1,259,700 Revenues-W Region 2,123,200 Operating Expenses-N Region 643,400 Operating Expenses-5 Region 749,700 Operating Expenses-W Region 1,284,000 Corporate Expenses-Dispatching 450,000 Corporate Expenses-Equipment Management 307,200 Corporate Expenses-Treasurer's 154,400 General Corporate Officers' Salaries 341,000 The company operates three support departments: the Dispatching Department, the Equipment Management Department, and the Treasurer's Department. The Dispatching Department manages the scheduling and releasing of completed trains. The Equipment Management Department manages the railroad cars inventories. It makes sure the right freight cars are at the right place at the right time. The Treasurer's Department conducts a variety of services for the company as a whole. The following additional information has been gathered: North South West Number of scheduled trains 5,600 6,800 10,100 Number of railroad cars in inventory 1,200 1,900 1,700 Required Required: 1. Prepare quarterly income statements showing operating income for the three regions. Use three column headings: North, South, and West. Do not round your interim calculations Thomas Railroad Company Divisional Income Statements For the Quarter Ended December 31 North Revenues Operating expenses Operating income before support department allocations Support department allocations: Dispatching Equipment Management Total support department allocations Operating income 1000000 00000001 1000 2. What is the profit margin of each region? Round to one decimal place. Region North Region Profit Margin South Region West Region % Divisional Income Statements and Return on Investment Analysis E.F. Lynch Company is a diversified investment company with three operating divisions organized as investment centers. Condensed data taken from the records of the three divisions for the year ended June 30, 2018, are as follows: Fee revenue Operating expenses Invested assets Mutual Fund Division Electronic Brokerage Division Investment Banking Division $2,180,000 $2,260,000 $2,160,000 1,060,000 8,000,000 953,200 6,600,000 1,526,400 4,400,000 The management of Ef. Lynch Company is evaluating each division as a basis for planning a future expansion of operations. Required: 1. Prepare condensed divisional income statements for the three divisions, assuming that there were EF. Lynch Company Divisional Income Statements For the Year Ended June 30, 2018 Mutual Electronic Investment Fund Brokerage Banking Division Division Division support department allocations. fee revenue Operating expenses Operating income 1. Prepare condensed divisional income statements for the three divisions, assuming that there were no support department allocations EF. Lynch Company Divisional Income Statements For the Year Ended June 30, 2018 Mutual Electronic Investment Fund Brokerage Division Division Banking Division Fee revenue Operating expenses Operating income 2. Using the DuPont Formula for return on investment, compute the profit margin, investment turnover, and return on investment for each dhesion. Round your answers to one decimal place. Division Mutual Fund Division Electronic Brokerage Division Profit Margin Investment Turnover ROT % % 94 % % % 3. When faced with limited funds for expansion, management should consider an expansion of the L Division first Investment Banking Division