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Unformatted text preview: Cells with non-gray backgrounds are protected and cannot be edited. A red asterisk (*) wil appear in the row immediately to the right of an incorrect answer. a. b. TRANS-CONTINENTAL AIRLINES, INC. Divisional Income Statements For the Year Ended June 30, 2010 Passenger Division Cargo Division Revenues $1,400,000 $1,400,000 Operating expenses 950,000 1,200,000 Income from operations before service department charges $450,000 $200,000 Less service department charges: Training $128,000 $32,000 Flight scheduling 62,500 87,500 Reservations 210,000 400,500 0 119,500 Income from operations $49,500 $80,500 Instructions Because service department charges are inappropriately based on revenue, the reported division income does not adequately measure performance....
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- Winter '08