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Exam 24: Departmental Accounting

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Question 21

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The photography department in a department store experienced the following revenue and expenses during October: $\begin{array} { | l | r |} \hline \text { Sales } & \$ 11,000 \\\hline \text { Cost of Goods Sold } & 5,000 \\\hline \text { Direct Operating Expenses } & 800 \\\hline \text { Indirect Operating Expenses } & 2,100 \\\hline\end{array}$ The photography departmental gross profit on sales is:

A) $3,100.
B) $5,200.
C) $6,000.
D) $8,100.

E) C) and D)
F) A) and C)

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Question 22

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Julia Company allocates its indirect advertising expenses based on each department's gross sales.If the men's apparel department has gross sales of $225,000 out of a total of $2,025,000 in gross sales,what fraction would Julia use to allocate its indirect advertising expenses?

A) 1/9
B) 1/10
C) 1/11
D) 1/8

E) A) and D)
F) A) and C)

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Question 23

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A company has four departments (A,B,C and A)A B)B C)C D)and the net sales are $35,000; $40,000; $60,000 and $25,000 respectively.The cost of goods sold per department are $25,000; $15,000; $40,000 and $15,000 respectively.What department has the lowest gross profit? D)both A and D

If there is a total of 50,000 square feet of floor space,and the hardware department utilizes 12,500 square feet,what percent of the total square footage is in hardware?

A department with sales of $120,000; cost of goods sold of $75,000; and operating expenses of $20,000 has a gross profit of $45,000.

A company has three departments (A,B,andC)and the net sales are $350,000; $410,000; and $285,000 respectively.The cost of goods sold per department are $295,000; $360,000; and $225,000 respectively.What department has the highest gross profit? A)A B)B C)C D)Both departments A and B

A company has four departments (A,B,C and A)A B)B C)C D)D D)and the net sales are $35,000; $40,000; $60,000 and $25,000 respectively.The cost of goods sold per department are $25,000; $15,000; $40,000 and $15,000 respectively.What department has the highest gross profit?

Calculate a department's gross profit on sales given the following: $\begin{array} {| l | r |} \hline\text { Sales } & \$ 1,600 \\\hline \text { Operating expenses } & 350 \\\hline \text { Cost of goods sold } & 900 \\\hline\end{array}$

An example of a cost center is:

The administrative department of a mall is a(n) :

The PPC department of Ajax shows gross sales of $730,600 for computer supplies and $934,900 for office supplies.The cost of the computer supplies was $534,000 and the cost of the office supplies was $491,400.Direct expenses were $56,600 for the company and indirect expenses were $75,200.What was the contribution margin for the company?

Indirect expenses may be allocated to departments based on the cost of goods sold in each department.

When a company tracks gross profit by department,the sales journal has separate columns for Accounts Receivable for each department.

You have been hired by Jones to allocate his utilities to each department based on space (in square footage). Complete the assignment. $\begin{array} { c c c r } &\text { Shoe Dept. } & \text { Jewelry Dept. } & \text { Clothing Dept. } & \text { Total } \\\text {Space (square feet)}&12,000 & 4,000 & 24,000 & 40,000 \\\text {Utilities Cost}& & & \$ 60,000\end{array}$

Trends in the industry,such as advancements in technology,should always be a consideration in determining whether or not a department is eliminated.

A department with sales of $120,000; cost of goods sold of $75,000; and operating expenses of $20,000 has a gross profit of $25,000.

Which allocation base is best used to allocate advertising expense by selling department?

Which allocation base is best used to allocate building depreciation?

A common way to apportion janitorial expense is to base it on gross sales.

Departmental accounting requires: