Required Information Learning Objective 09-P3: Prepare departmental income statements and contribution reports. Each profit center (department) is assigned its expenses to yield its own income statement These costs include its direc expenses and its share of indirect expenses. The departmental income statement lists its revenues and costs of goods sold to determine gross profit. Its operating expenses (direct expenses and its indirect expenses allocated to the department) are deducted from gross profit to yield departmental net income. The departmental contribution report is similar to the departmental income statement in terms of computing the gross profit for each department. Then the direc operating expenses for each department are deducted from gross profit to determine the contribution generated by eac department. Indirect operating expenses are deducted in total from the company's combined contribution Departmental Operating Expenses OVOGOR GAL Bande Data Service Durant Purchasing Operating Department MIMI Cang Co LA DE 11 1 1000 14:30 22000 14,000 600 DW Ini 12.00 DO Toe het Department Square Feet Percent of Total Allocated Cost Purchasing . 1.800 $2.400 Hiling --- 2.700 20% (1,800/9,000) 30% (2,700/9,000) 50% (4,500/9,000) 3.600 Camping -- 4.500 6.000 Total 9,000 100% $12,000 Knowledge Check 01 Rent expense of 53.000 is allocated to Department A and Department based on souare footage Department A has 5.000 square feet and Department B has 2.500 square feet department. Indirect operating expenses are deducted in total from the par Departmental Operating Expenses OUTDOOR SAL Sales and wat Service Department Operating Department king Camping Purchasing 1136,200 70,000 590.000 70.000 $14.000 SNE Cont of Direct Espen Swar Deprem Indirect Expenses Rent 410 3.000 25/005 2.COD 14,030 000 31.0 400 32.000 Totem cod Department Square Feet Percent of Total Allocated Cost Purchasing 1,800 20% (1,800/9,000) $ 2,400 Hiking 2,700 30% (2,700/9,000) 3,600 Camping 4,500 50% (4,500/9,000) 6,000 Total 9,000 100% $12,000 Knowledge Check 01 Rent expense of $3.000 is allocated to Department A and Department B based on square footage feet and Department B has 2,500 square feet. The dollar amount of rent expense allocated to Department B is