Glover Company has requested that you (1) assign indirect expenses to its jewelry and shoes departments as appropriate and (2) prepare an income statement for June 201X showing departmental contribution margins along with net income. Assume a 30% tax rate.

Salaries are based on net sales. All other indirect expenses are based on square footage.

Transcribed Image Text:

Jewelry (29,000 Shoes (13,500 square feet) quare feet) Indirect Cost Net Sales Merchandise Inventory (June 1 Merchandise Inventory (June 30) Purchases Purchases Discount Salaries Expense Depreciation Expense Advertising Expense Administrative Expense Rent Expense $283,000 54,000 40,000 202,000 11,500 2,900 24,200 950 $225,000 68,000 29,000 99,000 20,500 1,800 20,500 1,950 $9,600 21,000 32,500 11,700