Answer:
A Region $76,640
B Region $41,360
Explanation:
Calculation to Determine the divisional income from operations for the A and B regions.
First step is to find the Percentage of sales allocations:
Using this formula
Percentage of sales allocation= Sales amount/Total sales ×100
Let plug in the formula
A Region = $767,000 ÷($ $767,000+$413,000)×100
A Region=$767,000/$1,180,000 ×100
A Region= 0.65×100
A Region =65%
B Region =$413,000/($767,000+$413,000)×100
B Region=$413,000/$1,180,000 ×100
B Region=0.35×100
B Region=35%
Second step
Service department expenses=
Purchasing $198,200
Add Payroll accounting $132,200
=$330,400
Third step is the allocation of support department expenses for both A and B Region
A Region = 65% × $330,400 = $214,760
B Region=35%×$330,400=$115,640
Last step is to calculate for the Operating income of both region
A Region Operating Income = $767,000-$291,500-$184,100-$214,760
A Region Operating Income = $76,640
B Region Operating Income =$413,000-$156,900-$99,100-$115,640
B Region Operating Income =$41,360
Therefore tlthe divisional income from operations for the A and B regions will be :
A Region $76,640
B Region $41,360
