Reference no: EM131600141

Problem - Jansen Company reports the following for its ski department for the year 2015. All of its costs are direct, except as noted.

Sales - $ 600,000

Cost of goods sold - 445,000

Salaries - 112,000 ($25,600 is indirect)

Utilities - 14,800 ($5,400 is indirect)

Depreciation - 54,000 ($17,300 is indirect)

Office expenses - 26,400 (all indirect)

Required -

1. Prepare a department income statement for 2015.

2. Prepare a department contribution to overhead report for 2015.

3. Based on these two performance reports, should Jansen eliminate the ski department?