Departmental Income Statement
The following information was obtained from the ledger of Stillwell
Emporium, Inc., at the end of 2016
Stillwell Emporium, Inc. Trial Balance December 31, 2016 |
|||||
---|---|---|---|---|---|
Debit | Credit | ||||
Cash | $19,000 | ||||
Accounts receivable (net) | 70,000 | ||||
Inventory, December 31, 2016 | 45,000 | ||||
Equipment and fixtures (net) | 97,000 | ||||
Accounts payable | $34,000 | ||||
Common stock | 120,000 | ||||
Retained earnings | 30,000 | ||||
Revenue - department a | 367,000 | ||||
Revenue - department b | 143,000 | ||||
Cost of goods sold - department a | 216,000 | ||||
Cost of goods sold - department b | 70,000 | ||||
Sales salaries expense | 77,000 | ||||
Advertising expense | 34,000 | ||||
Insurance expense (on merchandise) | 10,000 | ||||
Uncollectible accounts expense | 3,000 | ||||
Occupancy expense | 16,000 | ||||
Office and other administrative expense | 37,000 | - | |||
$694,000 | $694,000 |
Stillwell analyzes its operating expenses at the end of each period in order to prepare an income statement that will exhibit departmental contribution to common expenses. From payroll records, advertising copy, and other records, the following tabulation was obtained:
Traceable Expense | ||||||
---|---|---|---|---|---|---|
Dept. A | Dept. B | Common Expense | ||||
Sales salaries expense | $49,000 | $21,000 | $7,000 | |||
Advertising expense | 16,000 | 7,000 | 11,000 | |||
Insurance expense | 8,000 | 2,000 | ||||
Occupancy expense | 16,000 | |||||
Uncollectible accounts expense | 2,000 | 1,000 | ||||
Office and other administrative expense | 18,000 | 10,000 | 9,000 |
Prepare a departmental income statement for Stillwell Emporium, Inc., showing departmental contribution to common expenses, assuming an overall income tax rate of 30%.
Do not use negative signs with your answers below.
Stillwell Emporium, Inc. Departmental Income Statement For the Year Ended December 31, 2016 |
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Dept. A | Dept. B | Total | ||||
Sales | Answer | Answer | Answer | |||
Cost of goods sold | Answer | Answer | Answer | |||
Gross profit | Answer | Answer | Answer | |||
Operating expenses: | ||||||
Sales salaries expense | Answer | Answer | Answer | |||
Advertising expense | Answer | Answer | Answer | |||
Insurance expense | Answer | Answer | Answer | |||
Uncollectible accounts expense | Answer | Answer | Answer | |||
Office and other administrative expense | Answer | Answer | Answer | |||
Traceable operating expenses | Answer | Answer | Answer | |||
Contribution to common expenses | Answer | Answer | Answer | |||
Common expenses | Answer | |||||
Income before tax | Answer | |||||
Income tax expense | Answer | |||||
Net income | Answer |
Departmental income statement | |||||||||
Dept A. | Dept B. | Total | |||||||
Sales | 367000 | 143000 | 510000 | ||||||
Cost of goods sold | 216000 | 70000 | 286000 | ||||||
Gross profit | A | 151000 | 73000 | 224000 | |||||
Operating expenses: | |||||||||
Sales salaries expense | 49000 | 21000 | 70000 | ||||||
Advertising expense | 16000 | 7000 | 23000 | ||||||
Insurance expense | 8000 | 2000 | 10000 | ||||||
Uncollectible accounts expense | 2000 | 1000 | 3000 | ||||||
Office and other administrative expense | 18000 | 10000 | 28000 | ||||||
Traceable operating expenses | B | 93000 | 41000 | 134000 | |||||
Contribution to common expenses | C=A-B | 58000 | 32000 | 90000 | |||||
Common expenses | (7000+11000+16000+9000) | 43000 | |||||||
Income before tax | 47000 | ||||||||
income tax expense | (At 30%) | 14100 | |||||||
Net income | 32900 | ||||||||
Departmental Income Statement The following information was obtained from the ledger of Stillwell Emporium, Inc., at...
Departmental Income Statement The following information was obtained from the ledger of Stillwell Emporium, Inc., at the end of 2016 Stillwell Emporium, Inc. Trial Balance December 31, 2016 Debit Credit Cash $19,000 Accounts receivable (net) 70,000 Inventory, December 31, 2016 45,000 Equipment and fixtures (net) 97,000 Accounts payable $34,000 Common stock 120,000 Retained earnings 30,000 Revenue - department a 367,000 Revenue - department b 143,000 Cost of goods sold - department a 216,000 Cost of goods sold - department b...
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