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:

RevenuesN Region	$1,140,000
RevenuesS Region	1,350,800
RevenuesW Region	2,459,200
Operating ExpensesN Region	722,400
Operating ExpensesS Region	803,900
Operating ExpensesW Region	1,487,200
Corporate ExpensesDispatching	594,000
Corporate ExpensesEquipment Management	254,200
Corporate ExpensesTreasurers	173,400
General Corporate Officers Salaries	382,900

The company operates three support departments: the Dispatching Department, the Equipment Management Department, and the Treasurers 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 Treasurers 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	5,000		5,900		8,900
Number of railroad cars in inventory	1,000		1,600		1,500

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.

North

South

West

Revenues

Operating expenses

Operating income before support department allocations

Support department allocations:

Dispatching

Equipment Management

Total support department allocations

Operating income

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:

RevenuesN Region	$1,140,000
RevenuesS Region	1,350,800
RevenuesW Region	2,459,200
Operating ExpensesN Region	722,400
Operating ExpensesS Region	803,900
Operating ExpensesW Region	1,487,200
Corporate ExpensesDispatching	594,000
Corporate ExpensesEquipment Management	254,200
Corporate ExpensesTreasurers	173,400
General Corporate Officers Salaries	382,900

The company operates three support departments: the Dispatching Department, the Equipment Management Department, and the Treasurers 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 Treasurers 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	5,000		5,900		8,900
Number of railroad cars in inventory	1,000		1,600		1,500

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	South	West
Revenues
Operating expenses
Operating income before support department allocations
Support department allocations:
Dispatching
Equipment Management
Total support department allocations
Operating income

2. What is the profit margin of each region? Round to one decimal place.

Region	Profit Margin
North Region
South Region
West Region