ADVANCED ACCOUNTING
12th Edition
ISBN: 9780357671221
Author: FISCHER
Publisher: CENGAGE L
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Question
Chapter 12, Problem 9.2E
To determine
Reportable segment:
A reportable segment is basically related to international accounting procedures.
Whether or not different areas would qualify as reportable segments.
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Fanning Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment
A were eliminated.
Segment
Sales
Cost of goods sold
Sales commissions
Contribution margin
General fixed operating expenses (allocation of president's salary)
Advertising expense (specific to individual divisions)
Net income (loss)
FANNING COMPANY
Income Statements for Year 2
Complete this question by entering your answers in the tabs below.
Required A Required B
Prepare a schedule of relevant sales and costs for Segment A.
Relevant Revenue and Cost Items for Segment A
Effect on income
$
Required
a. Prepare a schedule of relevant sales and costs for Segment A.
b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2)
the elimination of Segment A.
A
$ 169,000
(123,000)
(20,000)
26,000
(37,000)
(5,000)
$ (16,000)
0
B
$242,000
(92,000)
(32,000)
118,000
(35,000)
(19,000)
$ 64,000
с
$ 262,000…
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:
(see screen shot)
Ecru does not allocate its $1,480,000 in common expenses to the various segments.
Perform testing procedures to determine Ecru’s reportable operating segments.
Revenue test:
Profit or loss test:
Asset test:
What are the reportable segments? (Answer should be presented in this manner, example: A-B-C-D-E-F-G)
Chapter 12 Solutions
ADVANCED ACCOUNTING
Ch. 12 - Prob. 1UTICh. 12 - Prob. 2UTICh. 12 - Prob. 3UTICh. 12 - Prob. 4UTICh. 12 - Prob. 1.1ECh. 12 - Prob. 1.2ECh. 12 - Prob. 1.3ECh. 12 - Prob. 1.4ECh. 12 - Prob. 1.5ECh. 12 - Prob. 1.6E
Ch. 12 - Prob. 2ECh. 12 - Prob. 3ECh. 12 - Prob. 4.1ECh. 12 - Prob. 4.2ECh. 12 - Prob. 6ECh. 12 - Prob. 7ECh. 12 - Ratable allocation for nonordinary items. Baxter...Ch. 12 - Prob. 9.1ECh. 12 - Prob. 9.2ECh. 12 - Prob. 9.3ECh. 12 - Prob. 10ECh. 12 - Prob. 12.1PCh. 12 - Prob. 12.2PCh. 12 - Prob. 12.3PCh. 12 - Prob. 12.4PCh. 12 - Prob. 12.5PCh. 12 - Prob. 12.6PCh. 12 - Prob. 12.7.1PCh. 12 - Prob. 12.7.2PCh. 12 - Prob. 12.7.3PCh. 12 - Prob. 12.8.1PCh. 12 - Prob. 12.8.2P
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