Ferntree Experiences has two operating divisions, Winery and Restaurant. The two divisions have a marketing agreement to provide ncentives to customers. The Winery division offers coupons good for meals at the restaurants and the Restaurant division offers coupons good for wine tastings and purchases. Annual profits are $60 million. The two divisions meet the requirements for segment disclosures. Before the transactions are considered, revenues and costs (in thousands of dollars) for the two divisions are as follows. Restaurant $35,000 Revenue Costs Profit Winery $70,000 Revenues Costs Profit ? ? After adjusting appropriately for the effect of the marketing agreement, the revenues and costs are as follows. Winery Restaurant ? ? ? $14,400 $11,000 ? Value of coupons issued by Winery Division Value of coupons issued by Restaurant Division ? The value of the coupons issued by the Restaurant Division was double the value of the coupons issued by the Winery Division. Required: What was the value of the coupons issued by the Winery Division? By the Restaurant Division? (Enter your answers in whole dollars not in thousands of dollars.)
Ferntree Experiences has two operating divisions, Winery and Restaurant. The two divisions have a marketing agreement to provide ncentives to customers. The Winery division offers coupons good for meals at the restaurants and the Restaurant division offers coupons good for wine tastings and purchases. Annual profits are $60 million. The two divisions meet the requirements for segment disclosures. Before the transactions are considered, revenues and costs (in thousands of dollars) for the two divisions are as follows. Restaurant $35,000 Revenue Costs Profit Winery $70,000 Revenues Costs Profit ? ? After adjusting appropriately for the effect of the marketing agreement, the revenues and costs are as follows. Winery Restaurant ? ? ? $14,400 $11,000 ? Value of coupons issued by Winery Division Value of coupons issued by Restaurant Division ? The value of the coupons issued by the Restaurant Division was double the value of the coupons issued by the Winery Division. Required: What was the value of the coupons issued by the Winery Division? By the Restaurant Division? (Enter your answers in whole dollars not in thousands of dollars.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Vinubhai
Transcribed Image Text:Ferntree Experiences has two operating divisions, Winery and Restaurant. The two divisions have a marketing agreement to provide
incentives to customers. The Winery division offers coupons good for meals at the restaurants and the Restaurant division offers
coupons good for wine tastings and purchases. Annual profits are $60 million. The two divisions meet the requirements for segment
disclosures.
Before the transactions are considered, revenues and costs (in thousands of dollars) for the two divisions are as follows.
Restaurant
$35,000
Revenue
Costs
Profit
Winery
$70,000
Revenues
Costs
Profit
?
?
After adjusting appropriately for the effect of the marketing agreement, the revenues and costs are as follows.
Winery
?
?
Restaurant
?
$14,400
$11,000
?
?
Value of coupons issued by Winery Division
Value of coupons issued by Restaurant Division
?
The value of the coupons issued by the Restaurant Division was double the value of the coupons issued by the Winery Division.
Required:
What was the value of the coupons issued by the Winery Division? By the Restaurant Division? (Enter your answers in whole dollars
not in thousands of dollars.)
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps with 1 images
Knowledge Booster
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.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education