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Problem 8-35 (Algo) (LO 8-2) Ecru Company has identified five industry segments: plastics, metals, lumber, paper, and finance, It appropriately consolidated each of these segments in producing its annual financial statements. Information describing each segment (in thousands) follows: Sales to outside parties Intersegment transfers Interest income from outside parties Interest income from intersegment loans Operating expenses Interest expense Tangible assets Intangible assets Intersegment loans (debt) Plastics $6,770 153 a. Revenue test: b. Profit or loss test: c. Asset test: 0 0 4,274 79 1,517 90 0 Metals $2,369 176 37 0 1,792 34 3,211 406 0 Lumber $ 726 141 24 0 1,096 69 539 0 0 Ecru does not allocate its $1,340,000 in common expenses to the various segments. Perform testing procedures to determine Ecru's reportable operating segments. Paper $ 437 153 0 0 669 22 786 66 0 Finance $ 0 0 45 204 34 105 194 0 789

Problem 8-35 (Algo) (LO 8-2) Ecru Company has identified five industry segments: plastics, metals, lumber, paper, and finance, It appropriately consolidated each of these segments in producing its annual financial statements. Information describing each segment (in thousands) follows: Sales to outside parties Intersegment transfers Interest income from outside parties Interest income from intersegment loans Operating expenses Interest expense Tangible assets Intangible assets Intersegment loans (debt) Plastics $6,770 153 a. Revenue test: b. Profit or loss test: c. Asset test: 0 0 4,274 79 1,517 90 0 Metals $2,369 176 37 0 1,792 34 3,211 406 0 Lumber $ 726 141 24 0 1,096 69 539 0 0 Ecru does not allocate its $1,340,000 in common expenses to the various segments. Perform testing procedures to determine Ecru's reportable operating segments. Paper $ 437 153 0 0 669 22 786 66 0 Finance $ 0 0 45 204 34 105 194 0 789

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Problem 8-35 (Algo) (LO 8-2) Ecru Company has identified five industry segments: plastics, metals, lumber, paper, and finance. It appropriately consolidated each of these segments in producing its annual financial statements. Information describing each segment (in thousands) follows: Sales to outside parties Intersegment transfers Interest income from outside parties Interest income from intersegment loans Operating expenses Interest expense Tangible assets Intangible assets Intersegment loans (debt) 0 Plastics Metals $6,770 $2,369 153 176 37 0 1,792 34 3,211 406 0 4,274 79 1,517 90 0 0 a. Revenue test: b. Profit or loss test: c. Asset test: Lumber $ 726 141 24 0 1,096 69 539 0 0 Ecru does not allocate its $1,340,000 in common expenses to the various segments. Perform testing procedures to determine Ecru's reportable operating segments. Paper $437 153 0 0 669 22 786 66 0 Finance $0 0 45 204 34 105 194 0 709
Transcribed Image Text:Problem 8-35 (Algo) (LO 8-2) Ecru Company has identified five industry segments: plastics, metals, lumber, paper, and finance. It appropriately consolidated each of these segments in producing its annual financial statements. Information describing each segment (in thousands) follows: Sales to outside parties Intersegment transfers Interest income from outside parties Interest income from intersegment loans Operating expenses Interest expense Tangible assets Intangible assets Intersegment loans (debt) 0 Plastics Metals $6,770 $2,369 153 176 37 0 1,792 34 3,211 406 0 4,274 79 1,517 90 0 0 a. Revenue test: b. Profit or loss test: c. Asset test: Lumber $ 726 141 24 0 1,096 69 539 0 0 Ecru does not allocate its $1,340,000 in common expenses to the various segments. Perform testing procedures to determine Ecru's reportable operating segments. Paper $437 153 0 0 669 22 786 66 0 Finance $0 0 45 204 34 105 194 0 709
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