Discuss the below:
INCOME STATEMENT WITH DEPARTMENTAL GROSS PROFIT AND OPERATING INCOME
Q: Thomas and Hill Distributors has divided its business into two departments: commercial sales and industrial sales. The following information is provided for the year ended December 31, 20--:
Net sales, commercial sales department.............................$630,000
Net sales, industrial sales department.................................470,000
Cost of goods sold, commercial sales department...................378,000
Cost of goods sold, industrial sales department.....................188,000
Warehouse wages expense ...............................................99,400
Truck drivers' wages expense............................................88,200
Advertising expense.......................................................66,000
Warehouse lease expense.................................................30,000
Depreciation expense-delivery equipment...........................11,000
Other operating expenses................................................115,000
REQUIRED
Q1. Prepare an income statement showing departmental gross profit and total operating income.
Q2. Calculate departmental gross profit percentages.