Williams Company began operations in January 2013 with two operating (selling) departments and one service (office) department. Its departmental income statements follow WILLIAMS COMPANY Departmental Income Statements For Year Ended December 31, 2013 Clock Mirror Combined 130,000 55,000 85,000 Sales Cost of goods sold Gross profit 34,100 97,800 63,700 20,900 87,200 66,300 Direct expenses Sales salaries Advertising Store supplies used Depreciation-Equipment 20,000 1,200 900 1,500 7,000 27,000 1,700 1,300 1,800 500 400 300 Total direct expenses 23,600 8,200 31,800 Allocated expenses Rent expense Utilities expense Share of office department expenses 7,020 2,600 10,500 3,780 1,400 4,500 10,800 4,000 15,000 Total allocated expenses 20,120 9,680 29,800 17,880 61,600 Total expenses 43,720 Net income $22,580 3,020 $25,600