Rugged Rooms Ltd is a rug and drapery retailer. Rugged Rooms specialises in selling floor rugs and window dressings. The following information was derived from the shop’s accounting records for the year ended 30 June 2018:

	Floor rugs			Window dressings
Net sales Purchases Purchase returns Direct expenses Inventory, 1 July 2017 Inventory, 30 June 2018	$532 000 259 200 3 600 156 000 193 400 202 600			$456 000 328 320 3 800 78 500 149 200 148 900

Indirect expenses are $146 800 per year.

Required

A. Prepare a departmental income statement showing the departmental gross profit for each department and the store’s profit for the year.

B. Calculate the gross profit percentage for each department.

C. Prepare a departmental income statement that shows the profit of each department after the indirect operating expenses are allocated on the basis of gross profit.