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Vortex Company operates a retail store with two departments. Information about those departments follows. Department A $832,000 450,000 Department B $448,000 291,200 Sales Cost of
Vortex Company operates a retail store with two departments. Information about those departments follows. Department A $832,000 450,000 Department B $448,000 291,200 Sales Cost of goods sold Direct expenses: Salaries Insurance Utilities Depreciation Maintenance 116,000 17,500 23,500 19,500 6,800 86,000 10,200 27,500 14,000 5,300 The company also incurred the following indirect costs. Salaries Insurance Depreciation Office expenses $30,000 7,800 15,800 46,000 Indirect costs are allocated as follows: salaries on the basis of sales; insurance and depreciation on the basis of square footage; and office expenses on the basis of number of employees. Additional information about the departments follows. Department Number of employees A B Square footage 30,100 12,900 60 40 1. Determine the departmental contribution to overhead and the departmental net income for department A and Department B. 2. Should Department B be eliminated? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine the departmental contribution to overhead and the departmental net income for department A and Department B. (Do not round intermediate calculations. Round your final answers to nearest whole dollar.) VORTEX COMPANY Departmental Contribution Statements Department A Department B 0 0 Direct expenses Total direct expenses 0 0 Allocated indirect expenses 0 0 Total indirect expenses Operating income (loss) $ 0 $ 0
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