Departmental Income Statement
Perkins Appliance & Furniture Company has two departments, appliances and furniture. Operating information for the year appears below.
Alliance Department Furniture Department
Inventory, January $ $
Inventory, December
Net sales
Purchases
Purchases discounts
Transportation in
Traceable departmental expenses
Common operating expenses of the firm were $
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 Perkins uses a periodic inventory system.
Do not use negative signs with any of your answers below.
Perkins Appliance & Furniture Company
Departmental Income Statement
For the Year Ended December
Appliance Department Furniture Department Total
Net sales Answer
Answer
Answer
Cost of goods sold:
Inventory, January Answer
Answer
Answer
Purchases Answer
Answer
Answer
Purchases discounts Answer
Answer
Answer
Transportation in Answer
Answer
Answer
Cost of goods available for sale Answer
Answer
Answer
Inventory, December Answer
Answer
Answer
Cost of goods sold Answer
Answer
Answer
Gross Profit Answer
Answer
Answer
Traceable department expenses Answer
Answer
Answer
Contribution to common expenses Answer
Answer
Answer
Common expenses Answer
Income before tax Answer
Income tax expense Answer
Net income Answer
b Calculate the gross profit percentage for each department.
Round to the nearest whole percentage.
Appliance department
Answer
Furniture department
Answer
c If the common expenses were allocated to the appliance department and to the furniture department, what would the net income be for each department?
Do not use negative signs with any of your answers below.
Appliance Department Furniture Department Total
Contribution to common expenses Answer
Answer
Answer
Common expenses Answer
Answer
Answer
Income before tax Answer
Answer
Answer
Income tax expense Answer
Answer
Answer
Net income Answer
Answer
Answer
