Mason Company has prepared consolidated financial statements for the current year and is now gathering information in connection with the following five operating segments it has identified. Company Total Books Computers Maps Travel Finance Sales to outside parties $ 1,547 $ 121 $ 696 $ 416 $ 314 $ 0 Intersegment sales 421 24 240 39 118 0 Interest income—external 97 60 0 0 0 37 Interest income—intersegment loans 147 0 0 0 0 147 Assets 3,398 206 1,378 248 326 1,240 Operating expenses 1,460 115 818 304 190 33 Expenses—intersegment sales 198 70 51 31 46 0 Interest expense—external 107 0 0 0 0 107 Interest expense—intersegment loans 147 21 71 38 17 0 Income tax expense (savings) 21 12 (41 ) 27 31 (8 ) General corporate expenses 55 Unallocated operating costs 80 Determine the reportable segments by performing each applicable test. (Figures are in thousands.) Revenue test: Profit or loss test: Asset test:
The Effect Of Prepaid Taxes On Assets And Liabilities
Many businesses estimate tax liability and make payments throughout the year (often quarterly). When a company overestimates its tax liability, this results in the business paying a prepaid tax. Prepaid taxes will be reversed within one year but can result in prepaid assets and liabilities.
Final Accounts
Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded.
Ledger Posting
A ledger is an account that provides information on all the transactions that have taken place during a particular period. It is also known as General Ledger. For example, your bank account statement is a general ledger that gives information about the amount paid/debited or received/ credited from your bank account over some time.
Trial Balance and Final Accounts
In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately recorded or not. Trial balance helps in this. Trial balance helps to check the accuracy of posting the ledger accounts. It helps the accountant to assist in preparing final accounts. It also helps the accountant to check whether all the debits and credits of items are recorded and posted accurately. Like in a balance sheet debit and credit side should be equal, similarly in trial balance debit balance and credit balance should tally.
Adjustment Entries
At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. It is also known as end of period adjustment. It can also be referred as financial reporting that corrects the errors made previously in the accounting period. The basic characteristics of every adjustment entry is that it affects at least one real account and one nominal account.
Mason Company has prepared consolidated financial statements for the current year and is now gathering information in connection with the following five operating segments it has identified.
| Company Total |
Books | Computers | Maps | Travel | Finance | ||||||||||||||||||
| Sales to outside parties | $ | 1,547 | $ | 121 | $ | 696 | $ | 416 | $ | 314 | $ | 0 | |||||||||||
| Intersegment sales | 421 | 24 | 240 | 39 | 118 | 0 | |||||||||||||||||
| Interest income—external | 97 | 60 | 0 | 0 | 0 | 37 | |||||||||||||||||
| Interest income—intersegment loans | 147 | 0 | 0 | 0 | 0 | 147 | |||||||||||||||||
| Assets | 3,398 | 206 | 1,378 | 248 | 326 | 1,240 | |||||||||||||||||
| Operating expenses | 1,460 | 115 | 818 | 304 | 190 | 33 | |||||||||||||||||
| Expenses—intersegment sales | 198 | 70 | 51 | 31 | 46 | 0 | |||||||||||||||||
| Interest expense—external | 107 | 0 | 0 | 0 | 0 | 107 | |||||||||||||||||
| Interest expense—intersegment loans | 147 | 21 | 71 | 38 | 17 | 0 | |||||||||||||||||
| Income tax expense (savings) | 21 | 12 | (41 | ) | 27 | 31 | (8 | ) | |||||||||||||||
| General corporate expenses | 55 | ||||||||||||||||||||||
| Unallocated operating costs | 80 | ||||||||||||||||||||||
Determine the reportable segments by performing each applicable test. (Figures are in thousands.)
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Revenue test:
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Profit or loss test:
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Asset test:
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