Williams Company began operations in January 2017 with two operating (selling) departments and one service (office) department. Its departmental income statements follow. WILLIAMS COMPANY For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit Direct expenses Clock irror Combined $ 250,000 $ 95,000 345,000 122,500 58,900 181,400 127,500 36,100 163,600 Sales salaries Advertising store Depreciation Equipment Total direct expenses 22,000 1,900 1,050 2,000 26,950 7,700 700 650 900 950 29,700 2,600 1,700 2,900 36,900 supplies used Allocated expenses Rent expense Utilities expense Share of office department expenses Total allocated expenses 2,500 1,200 13,000 22,560 49,51 7,060 3,40 10,540 3,700 16,500 3,500 Total expenses Net ircome 67,540 77,990 $18,070 96,060 Williams plans to open a third department in January 2018 that will sell paintings. Management predicts that the new department will generate $46,000 in sales with a 85% gross profit margin and will require the following direct expenses: sales salaries, $6,500; advertising. $800; store supplies, $1,000; and equipment depreciation, $300. It will fit the new department into the current rented space by taking some square footage from the other two departments. When opened, the new painting department will fill one-fifth of the space presently used by the clock department and one-fourth used by the mirror department. Management does not predict any increase in utilities costs, which are allocated to the departments in proportion to occupied space (or rent expense. The company allocates office department expenses to the operating departments in proportion to their sales. It expects the painting department to increase total office department expenses by $7,400. Since the painting department will bring new customers into the store, management expects sales in both the clock and mirror departments to increase by 10%. No changes for those departments' gross profit percents or their direct expenses are expected except for store supplies used, which will increase in proportion to sales. Required: Prepare departmental income staterments that show the companny's predicted results of operations for calendar-year 2018 for the three operating (selling) departments and their combined totals. (Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.) Required: Prepare departmental income staterments that show the companny's predicted results of operations for calendar-year 2018 for the three operating (selling) departments and their combined totals. (Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.) WILLIAMS COMPANY For Year Ended December 31, 2018 Clock S275,000S04,500 64,790 39,710 46,000 $ 425,500 206,440 219,060 134,750 6.900 Cost of goods sold profit 140,250 39.100 Direct expenses Sales salaries 22,000 1,900 1,050 2,000 26,950 7,700 700 650 800 9,850 6.500 800 1,000 300 8600 36,200 3,400 2,700 3,100 45,400 Store supplies used Total direct e Allocated expenses 5,648 2,610 10,540 Rent expense Utilities expense Share of office dept. expenses Total allocated expenses 2.282 2,500 1,200 3,810 13,660 26,050$ 10,540 8,148 35,098 105,152 S 2.282 Total expenses 10,882 55,940 28 218 163,120 163,120 ncome Required information [The following information applies to the questions displayed below. Georgia Orchards produced a good crop of peaches this year. After preparing the following income statement, the company is concerned about the net loss on its No. 3 peaches. Incone Statement For Year Ended December 31, 2017 No. 2 No. 3 Conbined Sales (by grade) No. 11 408,000 Ibs. e $1.20/1b No. 21 409,000 Ibs. $0.80/1b No. 31 680,000 Ibs. $0.30/1b Total sales S4B9, 600 $326, 400 $ 204,000 $1,020,000 Costs Tree pruning and care $0.25/Ib Picking, sorting, and grading e S0.20/Ib Delivery costs 374,000 299,200 68,100 98,00 98, 0343,700 41,300 $290,800 $127,600 $ (139,700) 278,700 102,000 102,000 170,000 81,600 B1,600 136,000 37,700 15,20015,200 Net incame (los) In preparing this statement, the company allocated joint costs among the grades on a physical basis as an equal amount per pound. The company's delivery cost records show that $30,400 of the $68,100 relates to crating the No. 1 and No. 2 peaches and hauling them to the buyer. The remaining $37,700 of delivery costs is for crating the No. 3 peaches and hauling them to the cannery. 2. Using your answers to part 1, prepare an income statement using the joint costs allocated on a sales value basis. (Do not round intermediate calculations.) GEORGIA ORCHARDS Income Statement For Year Ended December 31, 2018 No. 1 No. 2 No. 3 Costs Total costs Williams Company began operations in January 2017 with two operating (selling) departments and one service (office) department. Its departmental income statements follow. WILLIAMS COMPANY For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit Direct expenses Clock irror Combined $ 250,000 $ 95,000 345,000 122,500 58,900 181,400 127,500 36,100 163,600 Sales salaries Advertising store Depreciation Equipment Total direct expenses 22,000 1,900 1,050 2,000 26,950 7,700 700 650 900 950 29,700 2,600 1,700 2,900 36,900 supplies used Allocated expenses Rent expense Utilities expense Share of office department expenses Total allocated expenses 2,500 1,200 13,000 22,560 49,51 7,060 3,40 10,540 3,700 16,500 3,500 Total expenses Net ircome 67,540 77,990 $18,070 96,060 Williams plans to open a third department in January 2018 that will sell paintings. Management predicts that the new department will generate $46,000 in sales with a 85% gross profit margin and will require the following direct expenses: sales salaries, $6,500; advertising. $800; store supplies, $1,000; and equipment depreciation, $300. It will fit the new department into the current rented space by taking some square footage from the other two departments. When opened, the new painting department will fill one-fifth of the space presently used by the clock department and one-fourth used by the mirror department. Management does not predict any increase in utilities costs, which are allocated to the departments in proportion to occupied space (or rent expense. The company allocates office department expenses to the operating departments in proportion to their sales. It expects the painting department to increase total office department expenses by $7,400. Since the painting department will bring new customers into the store, management expects sales in both the clock and mirror departments to increase by 10%. No changes for those departments' gross profit percents or their direct expenses are expected except for store supplies used, which will increase in proportion to sales. Required: Prepare departmental income staterments that show the companny's predicted results of operations for calendar-year 2018 for the three operating (selling) departments and their combined totals. (Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.) Required: Prepare departmental income staterments that show the companny's predicted results of operations for calendar-year 2018 for the three operating (selling) departments and their combined totals. (Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.) WILLIAMS COMPANY For Year Ended December 31, 2018 Clock S275,000S04,500 64,790 39,710 46,000 $ 425,500 206,440 219,060 134,750 6.900 Cost of goods sold profit 140,250 39.100 Direct expenses Sales salaries 22,000 1,900 1,050 2,000 26,950 7,700 700 650 800 9,850 6.500 800 1,000 300 8600 36,200 3,400 2,700 3,100 45,400 Store supplies used Total direct e Allocated expenses 5,648 2,610 10,540 Rent expense Utilities expense Share of office dept. expenses Total allocated expenses 2.282 2,500 1,200 3,810 13,660 26,050$ 10,540 8,148 35,098 105,152 S 2.282 Total expenses 10,882 55,940 28 218 163,120 163,120 ncome Required information [The following information applies to the questions displayed below. Georgia Orchards produced a good crop of peaches this year. After preparing the following income statement, the company is concerned about the net loss on its No. 3 peaches. Incone Statement For Year Ended December 31, 2017 No. 2 No. 3 Conbined Sales (by grade) No. 11 408,000 Ibs. e $1.20/1b No. 21 409,000 Ibs. $0.80/1b No. 31 680,000 Ibs. $0.30/1b Total sales S4B9, 600 $326, 400 $ 204,000 $1,020,000 Costs Tree pruning and care $0.25/Ib Picking, sorting, and grading e S0.20/Ib Delivery costs 374,000 299,200 68,100 98,00 98, 0343,700 41,300 $290,800 $127,600 $ (139,700) 278,700 102,000 102,000 170,000 81,600 B1,600 136,000 37,700 15,20015,200 Net incame (los) In preparing this statement, the company allocated joint costs among the grades on a physical basis as an equal amount per pound. The company's delivery cost records show that $30,400 of the $68,100 relates to crating the No. 1 and No. 2 peaches and hauling them to the buyer. The remaining $37,700 of delivery costs is for crating the No. 3 peaches and hauling them to the cannery. 2. Using your answers to part 1, prepare an income statement using the joint costs allocated on a sales value basis. (Do not round intermediate calculations.) GEORGIA ORCHARDS Income Statement For Year Ended December 31, 2018 No. 1 No. 2 No. 3 Costs Total costs