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Required information The following information applies to the questions displayed below.j Elegant Decor Company's management is trying to decide whether to eliminate Department 200, which
Required information The following information applies to the questions displayed below.j Elegant Decor Company's management is trying to decide whether to eliminate Department 200, which has produced losses or low profits for several years. The company's 2017 departmental income statements shows the following. ELEGANT DECOR COMPANY Departmental Income Statements For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit Operating expenses Dept. 100 Dept. 200 Combined $287,000 212,000 75,000 $445,000 270,000 175,000 $732,000 482,000 250,000 Direct expenses Advertising tore supplies used Depreciation-Store equipment Total direct expenses 17,000 5,500 4,800 27,300 14,000 5,100 3,800 22,900 31,000 10,600 8,600 50,200 Allocated expenses Sales salaries Rent expense Bad debts expense Office salary Insurance expense Miscellaneous office expenses Total allocated expenses 78,000 9,420 9,900 18,720 1,900 2,600 120,540 147,840 $27,160 124,800 14,130 17,700 31,200 2,900 4,500 195,230 245,430 $ (22,590) $ 4,570 46,800 4,710 7,800 12,480 1,000 1,900 74,690 97,590 Total expenses Net income (loss)
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