Quiz 25: P25: Segment Income Statement Dept
Open and review the worksheet indicated. In this problem you will prepare Company O's departmental income statement. You will use this income statement to assess performance. The data is already inputted into the worksheet. The unedited worksheet should look like this:
Open the file indicated. Input the formulas where indicate in the departmental worksheet using cell references so that the worksheet automatically updates when any values are changed. Use the information in the instructions to determine how each direct expense is allocated to each department when creating the formulas. When you are finished entering all of the formulas, the departmental income statement for Company O should look like this:
Below is a copy of the departmental income statement for Company O. Based on the information in this income statement, you can see that overall the company is doing okay. However, the apparel department is spending more money than they are bringing in with revenue. Company O either needs to reexamine how they allocate expenses to each department, or see what areas could be reduced in expenses.