Question
In: Accounting
Please explain why $140,000. Elektronix, Inc. has three operating segments with the following information: DVDs VCRs...
Please explain why $140,000.
Elektronix, Inc. has three operating segments with the following information: DVDs VCRs MP3s Sales to outsiders $ 4,000,000 $ 500,000 $ 2,000,000 Intersegment transfer none none $ 100,000 Segment expenses $ 3,000,000 $ 624,000 $ 1,700,000 Segment assets $ 14,000,000 $ 6,000,000 $ 5,000,000 What is the minimum amount of operating profit or loss an operating segment must have to be considered a reportable segment? A) $124,000. B) $127,600. C) $100,000. D) $130,000. E) $140,000.
Solutions
Expert Solution
| Answer: |
|
Profit /Loss from Sale of DVD's = Sales to outsiders (-) Segment expenses = $ 4,000,000 (-) $ 3,000,000 = $ 1,000,000 (Profit ) |
|
Profit /Loss from Sale of VCR's = Sales to outsiders (-) Segment expenses = $ 500,000 (-) $ 624,000 = ($ 124,000) (Loss ) |
|
Profit /Loss from Sale of DVD's = Sales to outsiders (+) Intersegment transfer (-) Segment expenses + = $ 2,000,000 (+) $ 100,000 (-) $ 1,700,000 = $ 400,000 (Profit ) |
|
The minimum amount of operating profit
or loss an operating segment must have to be considered a
reportable segment = 10% of Combined profit from Profitable Segments = 10 % x ( $ 1,000,000 + $ 400,000 ) = 10% x $ 1,400,000 = $ 140,000 |
| Option (E) is Correct |
ekkarill92 answered 1 year agoRelated Solutions
The following is financial information describing the six operating segments that make up Fairfield, Inc. (in...
The following is financial information describing the six
operating segments that make up Fairfield, Inc. (in thousands):
Segments
Red
Blue
Green
Pink
Black
White
Sales to outside parties
$
1,811
$
812
$
514
$
309
$
121
$
99
Intersegment revenues
16
91
109
0
16
302
Salary expense
614
379
402
312
317
62
Rent expense
139
166
81
92
42
31
Interest expense
65
59
82
49
14
5
Income tax expense (savings)
141
87
61
(86...
Following is financial information describing the six operating segments that make up Fairfield, Inc. (in thousands):
Following is financial information describing the six operating segments that make up Fairfield, Inc. (in thousands):
Segments
Red
Blue
Green
Pink
Black
White
Sales to outside parties
$
1,831
$
832
$
534
$
329
$
141
$
119
Intersegment revenues
36
111
129
0
36
...
Following is financial information describing the six operating segments that make up Fairfield, Inc. (in thousands):...
Following is financial information describing the six operating
segments that make up Fairfield, Inc. (in thousands):
Segments
Red
Blue
Green
Pink
Black
White
Sales to outside parties
$
1,822
$
823
$
525
$
320
$
132
$
110
Intersegment revenues
27
102
120
0
27
313
Salary expense
625
390
413
323
328
73
Rent expense
150
177
92
103
53
42
Interest expense
76
70
93
60
25
16
Income tax expense
(savings)
152
98
72
(97
)...
Required information An analysis of Abbey Company's operating segments provides the following information: Operating Segment Revenues...
Required information
An analysis of Abbey Company's operating segments provides the
following information:
Operating
Segment
Revenues
Segment
Profit (Loss)
Segment
Assets
External
Intersegment
A
$
30
$
27
$
6
$
40
B
45
0
32
120
C
36
0
(7
)
82
D
200
116
4
190
E
44
0
(72
)
38
Refer to the above information. Which of the operating segments
above are reportable segments?
Multiple Choice
B, C, and D
A, B, D, and E
B,...
The operating revenues of the three largest business segments for Time Warner, Inc., for a recent...
The operating revenues of the three largest business segments
for Time Warner, Inc., for a recent year follow. Each segment
includes a number of businesses, examples of which are indicated in
parentheses.
Time Warner, Inc.
Segment Revenues
(in millions)
Turner (cable networks and digital media)
$93,600
Home Box Office (pay television)
95,100
Warner Bros. (films, television, and videos)
81,700
Assume that the variable costs as a percent of sales for each
segment are as follows:
Turner
23%
Home Box Office...
C2. Blanton Corporation is comprised of five operating segments. Information about each of these segments is...
C2. Blanton Corporation is comprised of five operating segments.
Information about each of these segments is as follows (in
thousands):
Linens
Kitchen
Grocery
Furniture
Stationery
Sales to outsiders
$
47
$
253
$
22
$
61
$
14
Intersegment transfers
2
13
7
15
12
Interest revenue - outsiders
1
-
2
4
-
Interest revenue - intersegment
-
3
-
-
11
Operating expenses - outsiders
58
207
20
51
13
Operating expenses - intersegment
1
10
3
8...
Tuttle Company discloses supplementary operating segment information for its three reportable segments. Data for 20X3 are...
Tuttle Company discloses supplementary operating segment
information for its three reportable segments. Data for 20X3 are
available as follows:
Segment A
Segment B
Segment C
Sales
$
500,000
$
300,000
$
200,000
Traceable
operating expenses
250,000
120,000
90,000
Additional 20X3 expenses include indirect operating expenses of
$100,000. Appropriately selected common indirect operating expenses
are allocated to segments based on the ratio of each segment's
sales to total sales. The 20X3 operating profit for Segment A
was:
Multiple Choice
$200,000
$180,000...
The following information pertains to Superstar Music's operating segments for the year ended December 31. ...
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....
With regards to Operating Leverage, please explain why a company with HIGH Operating Leverage faces greater...
With regards to Operating Leverage, please explain why a company
with HIGH Operating Leverage faces greater financial risk in a
declining sales period compared to a company with LOW Operating
Leverage. (HINT: The key here is the relation between fixed costs
and variable costs.)
What does a business's Contribution Margin represent? What does
the Contribution Margin have to do with Operating Leverage?
With regards to Operating Leverage, please explain why a company with HIGH Operating Leverage faces greater...
With regards to Operating Leverage, please explain why a
company with HIGH Operating Leverage faces greater financial risk
in a declining sales period compared to a company with LOW
Operating Leverage. (HINT: The key here is the relation between
fixed costs and variable costs.)
What does a business's Contribution Margin represent? What
does the Contribution Margin have to do with Operating
Leverage?
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- "Ethical Considerations" Please respond to the following: Reflect upon the responsibilities placed on auditors by the...
- A Japanese company has a bond outstanding that sells for 93 percent of its ¥100,000 par...
- What is the difference among the principles of modularization, abstraction, encapsulation, and separation of interface and...
- An investment project costs $20,100 and has annual cash flows of $4,400 for six years. ...
- PUT IN JAVA PROGRAMMING The StockB class: Design a class named StockB that contains the following...
- Draw a DFA for the following ( ∑ = {0,1}): Set of all strings with.
- In the article from Forbes notes that the goal of a leader is not to clone...
ADVERTISEMENT