Williams Company began operations in January 2019 with two operating (selling) departments and one service office) department. Its departmental income statements follow Mirror Combined $115.000 285. 71,300 156,600 43,700 130,400 8,300 900 WILLIAMS COMPANY Departmental Income Statements For Year Ended December 31, 2019 Clock Sales $ 170.00 Cost of goods sold 83,300 Gross profit 86,700 Direct expenses Sales salaries 21,500 Advertising 1,400 Store supplies used 1.000 Depreciation-Equipment 1.600 Total direct expenses 25,500 Allocated expenses Rent expense 7.07 Utilities expense 3.100 Share of office department expe Total allocated expenses Total expenses Net Income 29,800 2.300 1,300 2200 35,600 10.100 11.03 4.500 19.000 34.530 20.24060.22 Williams plans to open a third department in January 2020 that will sell paintings. Management predicts that the new department will generate $49,000 in sales with a 85% gross profit margin and will require the following direct expenses: sales salaries, $8,500 advertising. $1,100, store supplies, $700, and equipment depreciation, $500. 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 for 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 $7,300. Since the Painting department will bring new customers into the store. management expects sales in both the Clock and Mirror departments to increase by 13%. 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 statements that show the company's predicted results of operations for calendar year 2020 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 Forecasted Departmental Income Statements For Year Ended December 31, 2020 wy Increase in utilities costs, which are allocated to the departments in proportion to occupied space for 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 $7,300. Since the Painting department will bring new customers into the store, management expects sales in both the Clock and Mirror departments to increase by 13%. No changes for those departments' gross profit percent of their direct expenses are expected except for store supplies used, which will increase in proportion to sales Required: Prepare departmental income statements that show the company's predicted results of operations for calendar year 2020 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 Forecasted Departmental Income Statements For Year Ended December 31, 2020 Clock Mirror Paintings Combined Direct expenses Total direct expenses Allocated expenses Total alocated expenses 000 Total expenses 0 S 0
