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Question - Arlington Clothing, Inc., shows the following information for its two divisions for year 1.
Lake Region
Coastal Region
Sales revenue
$4,140,000
$13,050,000
Cost of sales
2,681,300
6,525,000
Allocated corporate overhead
248,400
783,000
Other general and administration
551,900
3,753,000
Required -
a. Compute divisional operating income for the two divisions. Ignore taxes.
b-1. What are the gross margin and operating margin percentages for both divisions?
b-2. How well have these divisions performed?
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