Acompany has identified the following operating divisions: Trailers, Saddles, Bridles, and Grooming Gear. - Which ones of the 4 divisions are operating segments? - Which segments meet the revenue test? - Which are segments meet the asset test? - Which meet the profit & loss test? Sales to external customersInterest income from customerGain on sale of capital assetsLoss on sale of capital assetsSubtotal - external revenuesIntersegment salesIntersegment interest incomeTotal revenuesPayroll expensesSelling expensesAdministration expensesDeprepciation & amortizationTotal expensesOperating profit or lossCurrentNon current assetsTotal assetsCurrent LiabilitiesNon current liabilitiesTotal liabilitiesNet assetsHorseTrailers % of Total7,50054%13062%2,00089%(2,500) 100%7,13052%16042%1017%51%7,3003,400450800904,7402,5601,2009002,1001,1001,1001,00048%41%43%60%47%63%78%60%69%85%0%83%59%Saddles % of Total5,00036%405,04070305,1402,200300600203,1202,02010020030020153526519%0%0%36%18%50%36%31%27%32%13%31%50%7%13%10%2%43%3%16%Bridles % of Total1,2009%2010%25011%0%11%29%17%11%1,470110101,5901,300300400302,030(440)20030050015015035018%27%22%20%20%-11%13%20%17%12%0%11%21%GroomingGear150201704010220180505010290(70)3010013025204585% of Total1%10%0%0%1%11%17%2%3%5%3%7%3%-2%2%7%4%2%57%3%5%Total13,8502102,250(2,500)13,8103806014,2507,0801,1001,85015010,1804,0701,5301,5003,0301,295351,3301,700

Operating Segments—The Management ApproachThe management approach to determining segments is based…

Acompany has identified the following operating divisions: Trailers, Saddles, Bridles, and Grooming Gear. - Which ones of the 4 divisions are operating segments? - Which segments meet the revenue test? - Which are segments meet the asset test?

Acompany has identified the following operating divisions: Trailers, Saddles, Bridles, and Grooming Gear. - Which ones of the 4 divisions are operating segments? - Which segments meet the revenue test? - Which are segments meet the asset test?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: 9

A: Detailed explanation: 1. Cost CentreA cost centre is a part of an organization that does not…

Q: 1. Differentiate between a profit center and an investment center.

A: Hey, since there are multiple questions posted, we will answer first question. If you want any…

Q: Which of the following is classified as a general expense? U A) Depreciation costs of showroom O B)…

A: General expenses are different from selling and distribution expenses A) Depreciation costs of…

Q: Vernon Company operates three segments. Income statements for the segments imply that profitability…

A: Segmented Income Statement:A segmented income statement provides a more thorough analysis of…

Q: The Maintenance Department of a company is considered to be a: A) Revenue Center B) Cost Center C)…

A: generally, the maintenance department is responsible and accountable for maintenance. a cost center…

Q: evenue: Product Service Total revenue ost of revenue: Product Service Total cost of revenue Gross…

A: The income statement is one of the major components of the financial statement. It records all the…

Q: help please answer in text form with proper workings and explanation for each and every part and…

A: To determine the payback period and analyze the effect of a larger cash inflow in the last year, we…

Q: Match the following terms Question 1 options: benchmarking analysis ratio analysis…

A: Lets understand the meaning of benchmarking analysis, ratio analysis, solvency and liquidity.…

Q: Which is the best definition of start-up costs? a. All activities associated with organizing a new…

A: Costs are that worth of money which is utilized to pay for the expenses. Costs are incurred to start…

Q: In each blank next to the following terms, place the identifying letter of its best description. 1.…

A: 1. Cost center--A. Incurs costs without directly yielding revenues.2. Profit center-- F.Incurs costs…

Q: Similar operating segments may be combined if the segments have similar economic characteristics.…

A: GAAP specifies that operating segments can be combines provided that these segments have the same…

Q: According to International Financial Reporting Standards (IFRS), which of the following is a key…

A: Recognizing revenue accurately is a fundamental aspect of accounting, ensuring financial statements…

Q: Explain the difference in net income between companies recording impairment under Successful Efforts…

A: Meaning of Net Income Net Income refers to the profits earned by a business after adjusting all the…

Q: The statement of income of Metal Corporation is shown below: Metal CORPORATION Statement of Income…

A: Lets understand the basics.Cashflow statement gets divided into three type of activities which…

Q: Kindly answer questions 1-3: 1.) Discretionary costs are costs that must be incurred because of past…

A: ANSWER 1) Discretionary cost is a cost which is not essential for the operation of business.Such…

Q: Which of the following applies conservatism to the financial statements of a full cost company?…

A: In accounting, the convention of conservatism, also known as the doctrine of prudence, is a policy…

Q: - Research and development (R&D), production, and customer service are business functions that are…

A: Business functions are the numerous tasks or procedures carried out by an organization to accomplish…

Q: 5- The ratio of Profit Before Tax Assets is known as? a-Net Profit after Taxes b-Return on assets…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: Profit Margin, Investment Turnover, and Return on Investment The condensed income statement for the…

A: Income statement is the financial statement that records all the income and expenses of the business…

Q: Given the following information for C & J, Inc. identify where the items will be classihed (asset or…

A: These statements are critical instruments for analyzing a company's financial health and stability,…

Q: Industry standards for financial statement analysis: Multiple Choice Are used to compare a company's…

A: There are four comparisons of standards of financial statements, competitors, intra-company…

Question

Acompany has identified the following operating divisions: Trailers, Saddles, Bridles, and Grooming Gear.

- Which ones of the 4 divisions are operating segments?

- Which segments meet the revenue test?

- Which are segments meet the asset test?

- Which meet the profit & loss test?

Sales to external customers
Interest income from customer
Gain on sale of capital assets
Loss on sale of capital assets
Subtotal - external revenues
Intersegment sales
Intersegment interest income
Total revenues
Payroll expenses
Selling expenses
Administration expenses
Deprepciation & amortization
Total expenses
Operating profit or loss
Current
Non current assets
Total assets
Current Liabilities
Non current liabilities
Total liabilities
Net assets
Horse
Trailers % of Total
7,500
54%
130
62%
2,000
89%
(2,500) 100%
7,130
52%
160
42%
10
17%
51%
7,300
3,400
450
800
90
4,740
2,560
1,200
900
2,100
1,100
1,100
1,000
48%
41%
43%
60%
47%
63%
78%
60%
69%
85%
0%
83%
59%
Saddles % of Total
5,000
36%
40
5,040
70
30
5,140
2,200
300
600
20
3,120
2,020
100
200
300
20
15
35
265
19%
0%
0%
36%
18%
50%
36%
31%
27%
32%
13%
31%
50%
7%
13%
10%
2%
43%
3%
16%
Bridles % of Total
1,200
9%
20
10%
250
11%
0%
11%
29%
17%
11%
1,470
110
10
1,590
1,300
300
400
30
2,030
(440)
200
300
500
150
150
350
18%
27%
22%
20%
20%
-11%
13%
20%
17%
12%
0%
11%
21%
Grooming
Gear
150
20
170
40
10
220
180
50
50
10
290
(70)
30
100
130
25
20
45
85
% of Total
1%
10%
0%
0%
1%
11%
17%
2%
3%
5%
3%
7%
3%
-2%
2%
7%
4%
2%
57%
3%
5%
Total
13,850
210
2,250
(2,500)
13,810
380
60
14,250
7,080
1,100
1,850
150
10,180
4,070
1,530
1,500
3,030
1,295
35
1,330
1,700

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Operating segment

VIEW

Step 2: When operating segment is considered significant

VIEW

Step 3: performing different test

VIEW

Solution

VIEW

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Discontinuing operations for a product or a service line

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Income reported for a business entity depends on the proper recognition of revenues and expenses. In certain cases, costs are recognised as expenses at the time of product sale and in other situations costs are capitalised if they bring future benefits.In around 250 words, comment on the above statement. Your comments should include valid examples and illustrations.
Manufacturing companies are not required to allocate joint-process costs in the valuation of inventories and cost of goods sold for O a. financial reporting. O b. tax reporting. c. managerial reporting. O d. All of the above.
Revenue Cycle is:Select one:a. None of the aboveb. A recurring set of business activities and related to the process starting from finalizing product design and finishing off at cost accounting.c. A recurring set of business activities and related data processing operations associated with the purchase of and payment for goods and services.d. A recurring set of business activities and related information processing operations associated with providing goods and services to customers and collecting cash in payment for those sales.
Which of the following is not a reason for banks to use activity- based costing? C a. to determine profitability of services provided Ob. to determine service quality c. to determine the amounts charged to customers for services provided Od. all of the above
A segment of a business responsible for both revenues and expenses would be called: Multiple Choice a cost center. a profit center. residual income. an investment center.
company operating results include all of the following EXCEPT: a. Ratio Analysis b. Vertical Analysis c. Circular Analysis d. Horizontal Analysis
Cost-volume-profit (CVP) analysis for revenue planning determines: The desired profit level of a firm. Both revenue maximization and cost minimization. The costs associated with a certain level of revenue. The max amount of revenue a firm can receive. The revenue required to achieve a desired profit level.
In determining if two operating segments may be combined into one, which of the following factors should be considered? a. similarities regarding profit margins b. whether the nature of the products and services is similar c. whether there is a similar amount of intracompany sales d. whether there is a similar number of employees
Q.Is there a cause-and-effect linkage between improvements in the measures in the internal-businessprocess perspective and the measure in the customer perspective? That is, would you add other measures to the internal-business-process perspective or the customer perspective? Why or why not? Explain briefly.