The Ski department reports sales of $605,000 and cost of goods sold of $423,500. Its expenses follow.

Direct expenses		Indirect expenses		Service department expenses
Salaries	$ 115,000	Rent	$ 17,900	Office	$ 25,600
Depreciation	44,800

1. For the Ski department only, prepare a departmental income statement

Departmental Income Statement
For Year Ended December 31	Ski Department
Expenses
Total expenses

• For the Ski department only, prepare a departmental contribution to overhead report. Based on these two reports, should the Ski department be eliminated?

  Departmental Contribution to Overhead
  For Year Ended December 31	Ski Department
  Total direct expenses
  Departmental contribution to overhead
  Should the Ski department be eliminated?