The unallocated income statement of De Souza Motel is shown below:   Rooms F&B Total Revenue 257,000 133,000 390,000 Cost of Sales   48,000 48,000 Payroll and Related Expenses 60,000 30,000 90,000 Other Direct Expenses 40,000 12,000 52,000 Total Expenses 100,000 90,000 190,000 Departmental Income 157,000 43,000 200,000 Administrative &General     60,000 Sales&Marketing     25,000 POM&Utility costs     20,000 GOP     95,000 Insurance     10,000 Depreciation     12,000 Total Fixed Charges     22,000 Income Before Income Taxes     73,000 Income Taxes     30,000 Net Income     47,000   Square Footage: Rooms- 120,000; F&B- 70,000       Required: 1.Which costs are indirect costs? Explain why! 2.Using square footage and the unallocated income statement , prepare a fully allocated income statement. 3.What do the results from part 2 suggest? Support your answer with numbers.

Using the data below for the Ace Guitar Company:     A Region   B Region   Sales $521,500   $968,500   Cost of goods sold 198,200   368,000   Selling expenses 125,200   232,400   Service department expenses         Purchasing       $250,300 Payroll accounting       166,900   Allocate service department expenses proportional to the sales of each region. Determine the divisional income from operations for the A and B regions. For interim calculations, round percentages to one decimal place. A Region $ B Region $

Buckley Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. BUCKLEY COMPANY Income Statements for Year 2 Segment A   B   C Sales $ 330,000     $ 480,000     $ 500,000   Cost of goods sold   (242,000 )     (184,000 )     (190,000 ) Sales commissions   (30,000 )     (44,000 )     (44,000 ) Contribution margin   58,000       252,000       266,000   General fixed operating expenses (allocation of president’s salary)   (92,000 )     (92,000 )     (92,000 ) Advertising expense (specific to individual divisions)   (6,000 )     (20,000 )     0   Net income (loss) $ (40,000 )   $ 140,000     $ 174,000     Required Prepare a schedule of relevant sales and costs for Segment A. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A. Options for required A table are: Advertising…

Darby Company, operating at full capacity, sold 129,600 units at a price of $123 per unit during the current year. Its income statement is as follows: Sales     $15,940,800 Cost of goods sold     5,658,000 Gross profit     $10,282,800 Expenses:       Selling expenses $2,829,000     Administrative expenses 1,681,000     Total expenses     4,510,000 Income from operations     $5,772,800 The division of costs between variable and fixed is as follows:   Variable Fixed Cost of goods sold 60%   40%   Selling expenses 50%   50%   Administrative expenses 30%   70%   Management is considering a plant expansion program for the following year that will permit an increase of $1,476,000 in yearly sales. The expansion will increase fixed costs by $196,800, but will not affect the relationship between sales and variable costs. Required: 1.  Determine the total variable costs and the total fixed costs for the current year. Total variable costs $fill in the blank 1…