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Problem - Sonya McDowell owns a business called The Knitting Chamber. She has divided her business into two departments: domestic yarn and international yarn. The following information is provided for the fiscal year ended June 30, 20--:
Domestic Yarn
International Yarn
Net sales
$60,000
$40,000
Cost of goods sold
37,200
28,000
Wages expense
10,000
5,000
Advertising expense
2,500
1,500
Other operating expenses
4,000
1,000
Required -
1. Prepare an income statement showing departmental operating income and total operating income.
2. Calculate departmental operating expense and operating income percentages.
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