Managerial Accounting

25 points eBook @ Hint E! Print References Below are departmental income statements for a guitar manufacturer. The manufacturer is considering eliminating its electric guitar department since it has a net loss. The company classifies advertising, rent, and utilities expenses as indirect. WHOLESALE GUITARS Departmental Income statements For Year Ended December 31, 2019 Acoustic Sales $102,300 Cost of goods sold 45,175 Gross profit 57,625 Operating expenses Advertising expense 5,055 Depreciation expenseEquipment 10.080 Salaries expense 19,900 Supplies expense 1,960 Rent expense 7,025 Utilities expense 2,995 Total operating expenses 47,015 Net income (loss) $ 10.510 Electric $83 , 800 46. 850 "337336 4,270 8.510 17,900 1,720 5,960 2,610 40,970 sumo) 1. Prepare a departmental contribution report that shows each department's contribution to overhead. 2. Based on contribution to overhead, should the electric guitar department be eliminated? Required 1 Required 2 Prepare a departmental contribution report that shows each department's contribution to overhead. WHOLESALE GUITARS Income Statement Showing Departmental Contribution to Overhead For Year Ended December 31, 2019 Acoustic Dept. Electric Dept. Combined Direct expenses Total direct expenses Departmental contributions to overhead Indirect expenses Total indirect expenses Based on contribution to Overhead, should the electric guitar department be eliminated? Based on contribution to overhead, should the electric guitar department be eliminated? _ ( Required 1