ADVANCED ACCOUNTING
ADVANCED ACCOUNTING
12th Edition
ISBN: 9780357671221
Author: FISCHER
Publisher: CENGAGE L
Question
Book Icon
Chapter 12, Problem 9.3E
To determine

Pre-Tax profit also known as Profit before Tax (PBT) is defined as the profit earned before the company paid income taxes.All expenses are deducted by PBT from revenue including interest expenses and operating expenses.

The four items that would likely compromise reconciliation of the total reportable segment amounts.

Blurred answer
Students have asked these similar questions
Franklin Corporation operates three investment centers. The following financial statements apply to the investment center named Bowman Division. BOWMAN DIVISION Income Statement For the Year Ended December 31, Year 2 $106,280 59,575 46,705 Sales revenue Cost of goods sold Gross margin Operating expenses Selling expenses Depreciation expense (2,650) (4,015) 40,040 Operating income Nonoperating item ( 4,900) $ 35,140 Loss on sale of land Net income BOWMAN DIVISION Balance Sheet As of December 31, Year 2 Assets Cash $ 12,592 Accounts receivable Merchandise inventory Equipment less accumulated depreciation Nonoperating assets 40,456 37,100 90,358 9,700 Total assets $190,206 Liabilities $ 9,567 Accounts payable Notes payable Stockholders' equity 64,000 78,000 38,639 Common stock Retained earnings Total liabilities and stockholder's equity $190,206
What amount should be disclosed as Dae-su's profit for the current year? * Dae-su Company has four manufacturing divisions, each of which has been determined to be a reportable segment. Common costs are appropriately allocated on the basis of each division's sales in relation to Dae-su's aggregate sales. Dae-su's 4th division accounted for 40% of Dae-su's total sales in the current year. For the current year, 4th division had sales of P8,000,000 and traceable costs of P4,800,000. In addition, the 4th division incurred interest expense of P640,000. In the current year, Dae-su incurred costs of P800,000 that were not directly traceable to any of the divisions. It is an entity policy that interest expense is included in the measure of profit or loss that is reviewed by the chief operating decision maker. O 3,200,000 O 3,000,000 O 2,880,000 O 2,240,000
Evaluate the performance of the two divisions assuming Lasky Manufacturing uses economic value added (EVA). Note: Note: Enter answers in thousands of dollars. Round your answers to 1 decimal place.
Knowledge Booster
Background pattern image
Similar questions
SEE MORE QUESTIONS
Recommended textbooks for you
Text book image
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning