Question

The following information pertains to Superstar Music's operating segments for the year ended December 31.
  

	Axl	Bruce	Celine	Diddy	Elvis	Total
External Sales	10,000	0	15,000	10,000	70,000	105,000
Intersegment Sales	5,000	15,000	0	10,000	30,000	60,000
Net Income (Loss)	(9,000)	0	5,000	3,000	50,000	49,000
Assets	5,000	12,000	5,000	5,000	60,000	87,000

  
Based solely, on this information, indicate which of the segments are considered to be reportable segments:
  
Use check boxes to indicate correct answers.

Axl

Bruce

Celine

Diddy

Elvis

Answer 1

Tests for reportable segment:

1. A segment should be reported it its assets are at least 10% of the company’s whole assets

2. . A segment should be reported it its revenues are at least 10% of the company’s total revenue

3. A segment should be reported it its profits are at least 10% of the company’s total profit

All segments except Celine should be reported

		Bruce	Celine	Diddy	Elvis	Total
	Axl
External Sales	10,000	0	15,000	10,000	70,000	105,000
Intersegment Sales	5,000	15,000	0	10,000	30,000	60,000
Total Sales	15,000	15,000	15,000	20,000	100,000	165,000
Percentage of Total sales	9%	9%	9%	12%	61%	100%
Net Income (Loss)	-9,000	0	5,000	3,000	50,000	58,000	Total Profit
Percentage of total Profit	16%		9%	5%	86%	-9,000	Total loss
Percentage of Total Income
Assets	5,000	12,000	5,000	5,000	60,000	87,000
Percentage of Total Assets	6%	14%	6%	6%	69%

Reportable Segments:

Axl

Bruce

Diddy

Elvis

		Bruce	Celine	Diddy	Elvis	Total
	Axl
External Sales	10,000	0	15,000	10,000	70,000	105,000
Intersegment Sales	5,000	15,000	0	10,000	30,000	60,000
Total Sales	15,000	15,000	15,000	20,000	100,000	165,000
Percentage of Total sales	9%	9%	9%	12%	61%	100%
Net Income (Loss)	-9,000	0	5,000	3,000	50,000	58,000	Total Profit
	16%		9%	5%	86%	-9,000	Total loss
Percentage of Total Income
Assets	5,000	12,000	5,000	5,000	60,000	87,000
Percentage of Total Assets	6%	14%	6%	6%	69%