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Chapter 25 - Departmentalized Profit and Cost Centers
63. Semidirect and indirect expenses are treated the same for accounting purposes. At the end
of the accounting period they are
64. Which of the following is NOT a limitation to using departmental operating income?
65. Departmental income statements provide management with information necessary for
decision-making. Which of the following is NOT a decision made possible by these
statements?
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69. City Shoe's insurance expense for the year totaled $6,300 and is to be allocated on the
basis of the book value of inventory and equipment in each department. Using the financial
data given below, compute the amount allocated to each department.
Book value of inventory and equipment:
(1) Women's Shoes, $79,800
(2) Men's Shoes, $69,300
(3) Children's Shoes, $60,900
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75. Data related to the income and expenses of Moffet Company for the year ended December
31, 2013, are shown below. Use this information to prepare a departmental income statement
showing contribution margin and net income of each department.
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80. Examine the following partial Income Statement for Gemology Products and determine
whether or not to close the Jewelry Department. If the Jewelry Department is closed, the
Insurance Expense will be reduced by $500 and one office employee part time position will
be eliminated. That position pays $6,500 a year. The other expenses will remain.
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81. Fill in the blanks where indicated in the partial Income Statement that follows.
Chapter 25 - Departmentalized Profit and Cost Centers
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