Vortex Company operates a retail store with two departments. Information about those departments follows.

	Department A		Department B
Sales	$832,000		$448,000
Cost of goods sold	499,200		313,600
Direct expenses
Salaries	126,000		89,000
Insurance	15,000		10,000
Utilities	26,000		8,000
Depreciation	22,000		13,000
Maintenance	7,000		5,000

The company also incurred the following indirect costs.

Salaries	$24,000
Insurance	6,000
Depreciation	18,000
Office expenses	40,000

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

Square footage

Number of employees

A

36,000

75

B

12,000

50

For each department, determine the departmental contribution to overhead and the departmental net income.

Vortex Company
Departmental Income Statements
	Dept. A	Dept. B
Sales
Cost of goods sold
Gross margin
Direct expenses
Salaries
Insurance
Utilities
Depreciation
Maintenance
Total direct expenses
Departmental contribution to overhead
Allocated indirect expenses
Salaries
Insurance
Depreciation
Office expenses
Total allocated indirect expenses
Departmental net income