Question

Jansen Company reports the following for its ski department for the year 2019. All of its costs are direct, except as noted. Sales Cost of goods sold Salaries Utilities Depreciation Office expenses $ 620,000 435,000 112,000 ($25,600 is indirect) 17,200 ($5,100 is indirect) 52,200 ($18,000 is indirect) 21,600 (all indirect) 1. Prepare a departmental income statement for 2019. 2. & 3. Prepare a departmental contribution to overhead report for 2019. Based on these two performance reports, should Jansen eliminate the ski department? Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 and 3 Prepare a departmental income statement for 2019. JANSEN COMPANY Departmental Income Statement-Ski Department For Year Ended December 31, 2019 Ski Dept Operating expenses

Answer 1

JASEN COMPANY Departemental Income Statement - Ski Department For year Ended December 31, 2019 Ski Dept Sales 620000 Cost of goods sold 435000 Gross profit 185000 Operating Expenses Salaries 112000 Utilities 17200 Depreciation 52200 Office expenses 21600 Operating loss - 18000

JASEN COMPANY Departemental Contribution to overhead - Ski Department For year Ended December 31, 2019 Sales 620000 Cost of goods sold 435000 Gross profit 185000 Direct Expenses Salaries 86400 Utilities 12100 Depreciation 34200 Contribution to overhead 52300 Should Jasen eliminate the ski department ? NO