Financial And Managerial Accounting
15th Edition
ISBN: 9781337902663
Author: WARREN, Carl S.
Publisher: Cengage Learning,
expand_more
expand_more
format_list_bulleted
Question
Chapter 21, Problem 3MAD
a.
To determine
Prepare a vertical analysis of the sales as a percent of total sales for the four segments.
b.
To determine
Identify whether the relative segment sale has been changed between Year 1 and Year 3.
c.
To determine
Prepare a horizontal analysis of the sales as a percent of total sales for the four segments.
d.
To determine
Interpret the horizontal segment sales analysis.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Analyze The Walt Disney Company by segment
The Walt Disney Company (DIS) is a leading worldwide entertainment company. Disney operates four business segments. These segments and some of their larger businesses are:
Media Networks: ABC Network, ESPN, Disney Channel, and A&E
Parks and Resorts: Walt Disney World Resort, Disneyland, and International Disney Resorts
Studio Entertainment: Walt Disney Pictures, Pixar, Marvel, and Lucasfilm
Consumer Products and Interactive Media: Licensing of Disney characters, publishing, and retail stores
Recent comparative revenues for the four segments are as follows (in millions):
Commodore Entertainment has four profitable business segments, described as follows:
• Media Networks: Television and radio • Parks and Resorts: Resorts, including Commodore land • Studio Entertainment: Motion pictures, musical recordings, and stage plays • Consumer Products: Character merchandising, Commodore stores, books, and magazines
Commodore Entertainment recently reported sector income from operations, revenue, and invested assets as follows:
Income from Operations
Revenue
Invested Assets
Media Networks
$146,640
$624,000
$780,000
Parks and Resorts
41,756
343,200
572,000
Studio Entertainment
13,392
260,400
372,000
Consumer Products
94,163
324,700
191,000
a. Use the DuPont formula to determine the return on investment for the four Commodore Entertainment sectors. Round Profit Margin and ROI to one decimal place and Investment Turnover to two decimal places.
Profit Margin
Investment Turnover
ROI
Media Networks
fill…
Carnarvon Ltd is a listed diversified retail company. Its stores are located mainly in Australia. It has three main types of stores: general department stores, liquor stores and specialist toy stores. Each of these stores has different products, customer types and distribution processes. In accordance with AASB 8/IFRS 8, Carnarvon Ltd has identified three operating segments: general department stores, liquor stores and specialist toy stores. All three business units earn most of their revenue from external customers. Total consolidated revenue of Carnarvon Ltd is $800 million.
Business segment
Segment revenue ($000)
Profit or loss ($000)
Segment assets ($000)
General dep store
500
28
800
Liquor stores
220
9
350
Toy stores
80
6
150
All segments
800
43
1300
Required: Determine which segments of Carnarvon Ltd are reportable in accordance with the guidelines provided in AASB 8/IFRS 8. Show your calculations.
Chapter 21 Solutions
Financial And Managerial Accounting
Ch. 21 - What types of costs are customarily included in...Ch. 21 - Which type of manufacturing cost (direct...Ch. 21 - Which of the following costs would be included in...Ch. 21 - In the variable costing income statement, how are...Ch. 21 - The manager of a company are planning to...Ch. 21 - Since all costs of operating a business are...Ch. 21 - Discuss how financial data prepared on the basis...Ch. 21 - Why might management analyze product...Ch. 21 - Explain why rewarding sales personnel on the basis...Ch. 21 - Explain why service companies use different...
Ch. 21 - Variable costing Marley Company has the following...Ch. 21 - Variable costingproduction exceeds sales Fixed...Ch. 21 - Variable costingsales exceed production The...Ch. 21 - Analyzing income under absorption and variable...Ch. 21 - Contribution margin by segment The following...Ch. 21 - At the end of the first year of operations, 21,500...Ch. 21 - Gallatin County Motors Inc. assembles and sells...Ch. 21 - Fresno Industries Inc. manufactures and sells...Ch. 21 - On March 31, the end of the first month of...Ch. 21 - On April 30, the end of the first month of...Ch. 21 - On October 31, the end of the first month of...Ch. 21 - The following data were adapted from a recent...Ch. 21 - Estimated income statements, using absorption and...Ch. 21 - The following data were adapted from a recent...Ch. 21 - How is the quantity factor for an increase or a...Ch. 21 - Explain why service companies use different...Ch. 21 - Galaxy Sports Inc. manufactures and sells two...Ch. 21 - Prob. 13ECh. 21 - Sales territory and salesperson profitability...Ch. 21 - Prob. 15ECh. 21 - Prob. 16ECh. 21 - Variable costing income statement for a service...Ch. 21 - Variable costing income statement for a service...Ch. 21 - Absorption and variable costing income statements...Ch. 21 - Prob. 2PACh. 21 - During the first month of operations ended May 31,...Ch. 21 - Salespersons report and analysis Walthman...Ch. 21 - Segment variable costing income statement and...Ch. 21 - Absorption and variable costing income statements...Ch. 21 - Income statements under absorption costing and...Ch. 21 - Absorption and variable costing income statements...Ch. 21 - Salespersons report and analysis Pachec Inc....Ch. 21 - Prob. 5PBCh. 21 - Comcast Corporation (CMCSA) is a global media and...Ch. 21 - Prob. 2MADCh. 21 - Prob. 3MADCh. 21 - Segment disclosure by Apple Inc. (AAPL) provides...Ch. 21 - Prob. 1TIFCh. 21 - Inventory effects under absorption costing BendOR,...Ch. 21 - Communication Bon Jager Inc. manufactures and...Ch. 21 - Data for the last fiscal year for Merlene Company...Ch. 21 - Chassen Company, a cracker and cookie...Ch. 21 - Mill Corporation had the following unit costs for...Ch. 21 - Bethany Company has just completed the first month...
Knowledge Booster
Similar questions
- Hasbro is a leading firm in the toy, game, and amusement industry. Its promoted brands group includes products from Playskool, Tonka, Milton Bradley, Parker Brothers, Tiger, and Wizards of the Coast. Sales of toys and games are highly variable from year to year depending on whether the latest products meet consumer interests. Hasbro also faces increasing competition from electronic and online games. Hasbro develops and promotes its core brands and manufactures and distributes products created by others under license arrangements. Hasbro pays a royalty to the creator of such products. In recent years, Hasbro has attempted to reduce its reliance on license arrangements, placing more emphasis on its core brands. Hasbro also has embarked on a strategy of reducing fixed selling and administrative costs in an effort to offset the negative effects on earnings of highly variable sales. Exhibit 4.30 presents the balance sheets for Hasbro for the years ended December 31, Years 1 through 4. Exhibit 4.31 presents the income statements and Exhibit 4.32 presents the statements of cash flows for Years 2 through 4. Exhibit 4.30 Exhibit 4.31 Exhibit 4.32 REQUIRED a. Exhibit 4.33 presents profitability ratios for Hasbro for Year 2 and Year 3. Calculate each of these financial ratios for Year 4. The income tax rate is 35%. b. Analyze the changes in ROA and its components for Hasbro over the three-year period, suggesting reasons for the changes observed. c. Analyze the changes in ROCE and its components for Hasbro over the three-year period, suggesting reasons for the changes observed. Exhibit 4.33arrow_forwardCarnarvon Ltd is a listed diversified retail company. Its stores are located mainly in Australia. It has three main types of stores: general department stores, liquor stores and specialist toy stores. Each of these stores has different products, customer types and distribution processes. In accordance with AASB 8/IFRS 8, Carnarvon Ltd has identified three operating segments: general department stores, liquor stores and specialist toy stores. All three business units earn most of their revenue from external customers. Total consolidated revenue of Carnarvon Ltd is $800 million. Business Segment Segment assets (S000) Profit or loss Segment revenue (S000) (S000) General Dept Store Liquor Stores Toy Stores All segments 500 28 800 220 9. 350 80 150 800 43 1300 Required: Determine which segments of Carnarvon Ltd are reportable in accordance with the guidelines provided in AASB 8/IFRS 8. Show your calculations.arrow_forwardHow would you categorize or classify a company like Disney?arrow_forward
- Acompany has identified the following operating divisions: Trailers, Saddles, Bridles, and Grooming Gear. - Which ones of the 4 divisions are operating segments? - Which segments meet the revenue test? - Which are segments meet the asset test? - Which meet the profit & loss test?arrow_forwardThe Walt Disney Company (DIS) has four business segments, described as follows: Media Networks: Television and radio Parks and Resorts: Resorts, including Disneyland Studio Entertainment: Motion pictures, musical recordings, and stage plays Consumer Products Interactive Media: Character merchandising, Disney stores, books, and games Disney recently reported segment operating income, revenue, and invested assets (in millions) as follows: a. Use the DuPont formula to determine the return on investment for the four Disney segments. Round percentages to one decimal place and investment turnover to two decimal places. b. How do the four segments differ in their profit margin, investment turnover, and return on investment?arrow_forwardCorcoran Heavy Industries Company (CHIC) is organized into four divisions, each of which operates in a different industry. The types of customer served and the method used to distribute products differ across all four of these industries. In addition, each division must comply with its own unique set of industry regulations related to issues such as safety and recyclability of materials.Operating profit before depreciation and amortization is the measure of profit regularly used by the chief operating decision maker for evaluating the performance of each of these divisions. In addition, information for each division on capital expenditures and depreciation and amortization is routinely provided by corporate headquarters to the chief operating decision maker. A summary of the information provided to the chief operating decision maker at the end of the current year is as follows:Required I. Prepare a report for CHIC's management evaluating whether the operating segments disclosures…arrow_forward
- Yogi-Tech Ltd is a manufacturer and distributer of computer related products. The company has three segments Computer monitors, Software and Keyboards. Each segment generates its revenue from sales to external customers and from intra-entity sales. Financial information is provided below. Segment Revenue ($) Expenses ($) Assets ($) Monitors 520,000 538,000 1,600,000 Software 724,000 427,000 1,130,000 Keyboards 93,000 190,000 41,000 Required: Discuss with supporting calculations, which segments are reportable operating segment according to AASB 8 Operating Segments. Show key workings to support your answer.arrow_forwardNonearrow_forwardWhat are the advantages and disadvantages of The Insurance Company allocating corporate costs to the regions?arrow_forward
- The Mega Supply Corporation has three divisions: Commercial Products, Consumer Products, and Corporate Offices, which are located in Hatfield, South Carolina; Palo Alto, California; and Tulsa, Oklahoma, respectively. The Commercial Products division deals exclusively in sales of industrial products and supplies to business organizations. The Consumer Products division sells nonindustrial products to private consumers. Both divisions have dedicated inventory warehouses at their respective locations in Hatfield and Palo Alto. Because of the dissimilar nature of the commercial and consumer division product lines, they do not share customers or vendors. Currently Mega Supply uses a centralized database, which is located at their Corporate Division in Tulsa. Some relevant database tables and attributes are presented in the figure designated Problem 1. When customers contact their respective sales division, the sales clerk logs into the corporate database, checks credit, determines product availability, and creates a sales invoice. The corporate office typically bills the customer within 3 or 4 days and extends terms of net 30. Inventory control, AR processing, cash receipts, purchases from vendors and AP processing, and cash disbursements are performed by the corporate office. Due to Megas rapid growth, the company has seen a significant increase in sales and purchase transactions, which has resulted in excessive delays in processing transactions from the central database. Since customer service, including rapid response to customer inquiries and sales order processing, is a cornerstone of Megas business model, these delays are unacceptable. Required Mega wants to improve response time by distributing some parts of the corporate database while keeping other parts of it centralized. (A) Develop a schema for distributing Mega Supply Corporations database. Add new tables and attributes as needed but limit the schema to the tables needed to support sales, cash receipts, purchases/AP, and cash disbursements. In your schema, indicate whether tables are centralized, replicated, or partitioned. (B) Explain how the new system will operate.arrow_forwardSherwin Williams is a national paint manufacturer and retailer. The company is segmented into five divisions: Paint Stores (branded retail location), Consumer (paint and through stores such as Sears, Home Depot, etc.), Automotive (sales to auto manufacturers), International, and Administration. The following is selected hypothetical divisional information for the company's two largest divisions: Paint Stores and Consumer (in thousand of dollars). Sales Operating Income Total Assets Paint Stores $3,900,000 $507,000 $1,500,000 Consumer $1,250,000 $175,000 $1,562,000 Assume that management has specified a 20% target rate of return. Calculate each division's capital turnover.arrow_forwardSegment Contribution Margin Analysis The Walt Disney Company (DIS) is a global entertainment company that is organized into four business segments as follows: Media Networks: Television production and distribution, including ABC television network, ESPN, National Geographic. Parks, Experiences, and Products Theme parks and resorts, including Walt Disney World and Disneyland; Experiences, including Disney Cruise Line and Disney Vacation Club: Products, including Disney and Pixar characters, comic books, and magazines. Studio Entertainment Music and motion picture production and distribution, including Twentieth Century Studios, Marvel, and Lucasfilm. Direct-to-Consumer & International Streaming services, including Disney+, ESPN+, and Hulu. For a recent year, Disney reported the following segment results (in millions): Segment Parks, Experiences, and Products Segment Media Networks Parks, Experiences, and Products Studio Entertainment Revenues $16,502 Operating expenses (16,700)…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College PubFinancial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
Financial Reporting, Financial Statement Analysis...FinanceISBN:9781285190907Author:James M. Wahlen, Stephen P. Baginski, Mark BradshawPublisher:Cengage Learning
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
Financial Reporting, Financial Statement Analysis...
Finance
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:Cengage Learning
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College