Jansen Company reports the following for its ski department for
Jansen Company reports the following for its ski department for the year 2015. All of its costs are direct, except as noted.
Sales . . . . . . . . . . . . . . . . . . . . .$605,000
Cost of goods sold. . . . . . . . . . 425,000
Salaries . . . . . . . . . . . . . . . . . . . 112,000 ($15,000 is indirect)
Utilities. . . . . . . . . . . . . . . . . . . 14,000 ($3,000 is indirect)
Depreciation . . . . . . . . . . . . . . 42,000 ($10,000 is indirect)
Office expenses . . . . . . . . . . . . 20,000 (all indirect)
Prepare a
(1) Departmental income statement for 2015
(2) Departmental contribution to overhead report for 2015.
(3) Based on these two performance reports, should Jansen eliminate the ski department?
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