Exam 24: Departmental Accounting

Below is a list of expenses; you are to identify each as either [1] a direct expense or [2] an indirect expense. -Wages paid to the manager of an automobile repair shop. ________

Direct expenses, such as salaries, can be traced to a particular department.

In a department store, the men's clothing section would be a(n):

All of the following are used to compute gross profit except:

Below is a list of departments; you are to identify each as either [1] a profit center or [2] a cost center. -The tax offices of a CPA firm. ________

Which of the following is normally the report prepared for a department?

Advertising expense totaled $60,000. If indirect advertising costs are allocated based on gross sales per department, what amount would be allocated to the watches department if $5,000 of advertising is indirect? Gross Sales: jewelry, $80,000; glassware, $30,000; watches, $20,000. (Round any percentages two decimal places, X.XX%, and round your final answer to the nearest dollar.)

When a company tracks gross profit by department, the sales journal has one column for Sales for each department.

The catering department of a construction firm is a(n):

A profit center and a cost center both generate revenue.

Sales minus cost of goods sold yields:

A department income statement showing gross profit by department is a useful tool in analyzing performance of individual departments.

Departmental reports are NOT useful for:

Indirect expenses are subjective in nature and may only be allocated by cost of goods sold.

The PPC department of Ajax shows gross sales of $805,600 for computer supplies and $910,600 for office supplies. The cost of the computer supplies was $530,000 and the cost of the office supplies was $488,000. What is the gross profit for each category of the department respectively?

Direct expenses and indirect expenses are separated in determining contribution margin.

If gross sales for the tools department are $450,000 and gross sales for the appliances department are $270,000, what is the fraction used to apportion the indirect advertising for the appliances department if it is based on gross sales?

Calculate the costume jewelry department net income (loss) given the following:

The financial statement(s) that cannot be broken down by departments would be a(n):

A unit or department that incurs costs but does not generate revenues is known as a: