Greer Company requested that you (1) assign indirect expenses to its jewelry and shoes departments as appropriate and (2) prepare an income statement for August 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.

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Jewelry (29,000 Shoes (10,000 square feet) square feet) Indirect Cost Net Sales Merchandise Inventory (August 1) Merchandise Inventory (August 30) Purchases Purchases Discount Salaries Expense Depreciation Expense Advertising Expense Administrative Expense Rent Expense $280,000 54,000 42,000 200,000 11,000 3,300 24,400 1,150 $218,000 71,000 34,000 96,000 22,000 2,150 21,100 1,800 $9,400 22,000 32,500 12,200