Discuss common expenses and net income of the firm

Assignment Help Accounting Basics
Reference no: EM131786703

Departmental Income Statement

Elgin Flooring Company sells floor coverings through two departments, carpeting and hard covering (tile and linoleum). Operating information for 2016 appears below.

Inventory, January 1, 2016 $65,000  $31,000 
Inventory, December 31, 2016 45,000  25,000 
Net sales 780,000  480,000 
Purchases 484,000  362,000 
Purchases returns 28,000  8,000 
Purchases discounts 16,000  4,000 
Transporation in 18,000  14,000 
Traceable departmental expenses 104,000  52,000 

Common operating expenses of the firm were $120,000.

a. Prepare a departmental income statement showing departmental contribution to common expenses and net income of the firm. Assume an overall effective income tax rate of 35%. Elgin uses a periodic inventory system.

b. Calculate the gross profit percentage for each department.

Round to the nearest whole percentage.

Carpeting department

Hard Covering department

c. If the common expenses were allocated 70% to the carpeting department and 30% to the hard covering department, what would the net income be for each department?

Reference no: EM131786703

Questions Cloud

Recruited and selected new employees : Describe how Maersk has recruited and selected new employees who were aligned with the organization's vision and goals over the years.
The company to market blood pressure instrument : What elements of promotion mix would be more appropriate for the company to market blood pressure instrument and why?
Structuring a performance based logistics : You are structuring a Performance Based Logistics (PBL) Product Support Arrangement (PSA) for a legacy system. A key military depot will assume.
What is his federal income tax : His AGI includes $4000 of qualified dividends. Richard has no dependents and does not itemize deductions. What is his 2010 federal income tax
Discuss common expenses and net income of the firm : Prepare a departmental income statement showing departmental contribution to common expenses and net income of the firm
Determine how complex to make the wbs : So, how does a project manager determine how complex to make the WBS?
Useful for a job search for marketing position : Create a one-page resume that would be useful for a job search for a marketing position.
Record the pension expenditure in the appropriate fund : Record pension expenditures are not always influenced by actuarial computations. Record the Pension expenditure in the appropriate fund
Utah and minnesota incident reporting mandates : Part I: Review the Utah and Minnesota Incident reporting mandates. Compare these points:

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd