Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operating income in percentage, analyze the following financial information to determine costs that may need further investigation.Marley's ManufacturingIncome StatementMonth Ending August 31, 2018 Dept. ADept. BSales$23,000 $51,000 Cost of goods sold11,040 26,520 Gross profit$11,960 $24,480 Expenses: Utility expenses$920 $2,550 Wages expense5,980 10,710 Costs allocated from corporate2,300 14,280 Total expenses$9,200 $27,540 Operating income/(loss) in dollars$fill in the blank 1 $fill in the blank 2 Operating income/(loss) in percentagefill in the blank 3%fill in the blank 4%

Operating income/(loss) in dollars = Gross profit - Total expenses Operating income/(loss) in…

Answered: Assume you are the department B manager…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter9: Responsibility Accounting And Decentralization

Section: Chapter Questions

Problem 5EA: Assume you are the department B manager for Marleys Manufacturing. Marleys operates under a...

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Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operating income in percentage, analyze the following financial information to determine costs that may need further investigation.

Marley's Manufacturing Income Statement Month Ending August 31, 2018
	Dept. A	Dept. B
Sales	$23,000		$51,000
Cost of goods sold	11,040		26,520
Gross profit	$11,960		$24,480
Expenses:
Utility expenses	$920		$2,550
Wages expense	5,980		10,710
Costs allocated from corporate	2,300		14,280
Total expenses	$9,200		$27,540
Operating income/(loss) in dollars	$fill in the blank 1		$fill in the blank 2
Operating income/(loss) in percentage	fill in the blank 3	%	fill in the blank 4	%

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