Question
TIF 10-4 Evaluating Divisional Performance The three divisions of Yummy Foods are Snack Goods, Cereal, and Frozen Foods. The divisions are structured as investment
TIF 10-4 Evaluating Divisional Performance The three divisions of Yummy Foods are Snack Goods, Cereal, and Frozen Foods. The divisions are structured as investment centers. The following responsibility reports were prepared for the three divisions for the prior year: Revenues Operating expenses Operating income before Snack Goods $2,200,000 (1,366,600) Cereal $2,520,000 (1,122,000) Frozen Foods $2,100,000 support department allocations $ 833,400 $1,398,000 Support department allocations: Promotion $ (300,000) Legal (137,400) Total service department charges Operating income $ (437,400) $ 396,000 Invested assets $2,000,000 $ (600,000) (243,600) $ (843,600) $ 554,400 $1,680,000 (976,800) $1,123,200 $ (468,000) (235,200) $ (703,200) $420,000 $1,750,000
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