Reference no: EM13495231

Profit Center Responsibility Reporting

Johnson Products Inc. has three regional divisions organized as profit centers. The chief executive officer (CEO) evaluates divisional performance, using income from operations as a percent of revenues. The following quarterly income and expense accounts were provided from the trial balance as of December 31, 2012:

Revenues-East	$ 1,085,200
Revenues-West	1,259,700
Revenues-Central	2,337,500
Operating Expenses-East	687,700
Operating Expenses-West	749,700
Operating Expenses-Central	1,413,600
Corporate Expenses-Shareholder Relations	165,000
Corporate Expenses-Customer Support	621,600
Corporate Expenses-Legal	180,000
General Corporate Officer's Salaries	364,500

The company operates three service departments: Shareholder Relations, Customer Support, and Legal. The Shareholder Relations Department conducts a variety of services for shareholders of the company. The Customer Support Department is the company's point of contact for new service, complaints, and requests for repair. The department believes that the number of customer contacts is an activity base for this work. The Legal Department provides legal services for division management. The department believes that the number of hours billed is an activity base for this work. The following additional information has been gathered:

	East		West		Central
Number of customer contacts	5,600		6,700		9,900
Number of hours billed	900		1,400		1,300

Required:

a.Prepare quarterly income statements showing income from operations for the three divisions. Use three column headings: East, West, and Central.