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The bases to be used in allocating expenses, together with other essential information, are as follows: a. Advertising expense-incurred at headquarters, allocated to divisions on
The bases to be used in allocating expenses, together with other essential information, are as follows: a. Advertising expense-incurred at headquarters, allocated to divisions on the basis of usage: Winter Sports Division, $452,000; Summer Sports Division, $511,000. b. Transportation expense-allocated to divisions at an allocation rate of $15 per bill of lading: Winter Sports Division, 14,000 bills of lading; Summer Sports Division, 15,400 bills of lading. c. Accounts receivable collection expense-incurred at headquarters, allocated to divisions at an allocation rate of $9 per invoice: Winter Sports Division, 13,000 sales invoices; Summer Sports Division, 15,200 sales invoices. d. Warehouse expense-allocated to divisions on the basis of floor space used in storing division products: Winter Sports Division, 150,000 square feet; Summer Sports Division, 190,000 square feet. Prenare a divisional income statement with two column headinos: Winter Snorts Division and Summer Snorts \begin{tabular}{lr|} Winter Sports Division & Summer Spo Division \\ $29,452,500 & $32,538,000 \\ \hline 17,671,500 & 18,793,500 \\ \hline$11,781,000 & $13,744,500 \\ \hline \end{tabular} Divisional selling and administrative expenses: Divisional selling expenses Divisional administrative expenses Total divisional selling and administrative expenses Income from operations before service department allocations Less service department cost allocations: Advertising expense Transportation expense Accounts receivable collection expense Warehouse expense Total Income from operations Provide supporting schedules for determining service department cost allocations.. If required, round per unit amounts to two decimal places and final answers to the nearest dollar
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