Suresh Co. expects its tive departments to yield the tollowing income tor next y

Question

Suresh Co. expects its tive departments to yield the tollowing income tor next year Sales Expenses 88,000 46,880 $84, e00 72,880 47,080337,ee Avoidable Unavoidable Total expenses 19,300 59.400 8.780 $9,300 47,800 24,090 71,860 23,580 59,100 82,600 $(10?) 18,889 6,1ee 54,980$164,380 23.1 78,809 4.909 $59,100 336,000 ,000) Net income (loss) $(25,800) $(31,000) - Recompute and prepare the departmental income statements (ncluding a combined total column) for the ce each of the following separate scenarios. (1) Management eliminates departments with expected net losses DEPARTMENTS WMTH EXPECTED NET LOSSES ELIMINATED Dept. M Dept. N Dept. P Dept T Total Sales Avoidable Total expenses Net income (loss) eto search ??

Explanation / Answer

Solution 1:

Solution 2:

Departmental Income Statement Departments with expected net lossed eliminated Particulars Dept M Dept N Dept O Dept P Dept T Total Sales $88,000.00 $0.00 $84,000.00 $0.00 $0.00 $172,000.00 Expenses: Avoidable $19,300.00 $0.00 $18,800.00 $0.00 $0.00 $38,100.00 Unavoidable $59,400.00 $24,000.00 $6,100.00 $59,100.00 $23,100.00 $171,700.00 Total Expenses $78,700.00 $24,000.00 $24,900.00 $59,100.00 $23,100.00 $209,800.00 Net Income (Loss) $9,300.00 -$24,000.00 $59,100.00 -$59,100.00 -$23,100.00 -$37,800.00

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