Question 1

Which of the following is not a quantitative threshold for determining a reportable segment?

Accepted Answer

A)  Segment assets are 10% or more of the combined assets of all operating segments. 
B)  The absolute value of a segment's profit or loss is 10% or more of the greater of (1) the combined reported profit of all operating segments that reported a profit or (2) the absolute value of the combined reported loss of all operating segments that reported a loss. 
C)  Segment reported revenue, including intersegment revenues, is 10% or more of the combined revenue (both internal and external) of all operating segments. 
D)  Segment residual profit after the cost of equity is 10% or more of the combined residual profit of all operating segments. 
A)  Segment assets are 10% or more of the combined assets of all operating segments. 
B)  The absolute value of a segment's profit or loss is 10% or more of the greater of (1) the combined reported profit of all operating segments that reported a profit or (2) the absolute value of the combined reported loss of all operating segments that reported a loss. 
C)  Segment reported revenue, including intersegment revenues, is 10% or more of the combined revenue (both internal and external) of all operating segments. 
D)  Segment residual profit after the cost of equity is 10% or more of the combined residual profit of all operating segments. D

Question 2

For internal decision-making purposes, Calam Corporation's operating segments have been identified as follows:
   Required:
1. In applying the "operating profit or loss" test to identify reporting segments, what is the test value for Calam Corporation?
2. Using the "reported profit or loss" test, which of Calam's operating segments will also be reporting segments?

Accepted Answer

Requirement 1
If the absolute value of the total segments showing operating losses, $95,000, is more than the absolute value of the profitable segments, $85,000, then the absolute value of the loss segments, when multiplied by 10%, would become the test value for each segment. The $95,000 is multiplied by 10% to get $9,500, which is the test value for both the profitable and loss segments.
Requirement 2
Using the test value of $9,500 for profit and loss of the segments, only the Service Contracts and Catalog Sales segments would not be considered reportable segments.

Question 3

How does GAAP view interim accounting periods?

Accepted Answer

A)  As discrete units for which net income may be separately determined 
B)  As integral units of the entire year for which each interim period is an essential part of an annual period 
C)  As integral units of the entire year with each interim period as an independent accounting period 
D)  As discrete units of the entire year using the same principles that are applied to the annual period 
A)  As discrete units for which net income may be separately determined 
B)  As integral units of the entire year for which each interim period is an essential part of an annual period 
C)  As integral units of the entire year with each interim period as an independent accounting period 
D)  As discrete units of the entire year using the same principles that are applied to the annual period B

Question 4

The following information was collected together for the Lawson Company relating to the preparation of their annual financial statements for 2011. For each item, indicate "yes" or "no" as to whether the item must be disclosed in the annual report.

Accepted Answer

1. no, 2. yes, 3. no

Question 5

Which one of the following operating segment information items is not directly named by GAAP to be reconciled to consolidated totals?

Accepted Answer

A)  Assets 
B)  Liabilities 
C)  Revenues 
D)  Profit or loss 
A)  Assets 
B)  Liabilities 
C)  Revenues 
D)  Profit or loss

Question 6

Cole Company has the following 2014 financial data:   Cole Company should add segments if

Accepted Answer

A)  the sum of its segments' external revenue does not exceed $600,000. 
B)  the sum of its segments' external revenue does not exceed $825,000. 
C)  the sum of its segments' revenue including intersegment revenue does not exceed $600,000. 
D)  the sum of its segments' revenue including intersegment revenue does not exceed $825,000. 
A)  the sum of its segments' external revenue does not exceed $600,000. 
B)  the sum of its segments' external revenue does not exceed $825,000. 
C)  the sum of its segments' revenue including intersegment revenue does not exceed $600,000. 
D)  the sum of its segments' revenue including intersegment revenue does not exceed $825,000.

Question 7

GAAP requires disclosures for each reportable operating segment for each of the following, except for

Accepted Answer

A)  Revenues. 
B)  Depreciation expense. 
C)  R&D expenditures. 
D)  Extraordinary items. 
A)  Revenues. 
B)  Depreciation expense. 
C)  R&D expenditures. 
D)  Extraordinary items.

Question 8

Maxtil Corporation estimates its income by calendar quarter as follows for 2014:
   Required:
Determine Maxtil's estimated effective tax rate.

Accepted Answer

The answer of Maxtil Corporation estimates its income by calendar...

Question 9

For an operating segment to be considered a reporting segment under the revenue threshold, its reported revenue must be 10% or more of

Accepted Answer

A)  the combined enterprise revenues, eliminating all relevant intracompany transfers and balances. 
B)  the combined revenues, excluding intersegment revenues, of all operating segments. 
C)  the combined revenues, including intersegment revenues, of all operating segments. 
D)  the consolidated revenue of all operating segments. 
A)  the combined enterprise revenues, eliminating all relevant intracompany transfers and balances. 
B)  the combined revenues, excluding intersegment revenues, of all operating segments. 
C)  the combined revenues, including intersegment revenues, of all operating segments. 
D)  the consolidated revenue of all operating segments.

Question 10

Rollins Publishing has five operating segments, as summarized below:
   Required:
Determine which of the operating segments of Rollins Publishing are reportable segments for the period shown.

Accepted Answer

Revenue test: Total revenues (external a

Question 11

Dott Corporation experienced a $100,000 extraordinary loss in the second quarter of 2014 in their East Coast operating segment. The loss should be recognized

Accepted Answer

A)  only at the consolidated report level at the end of the year. 
B)  entirely in the second quarter of 2014 in the East Coast operating segment. 
C)  in equal amounts allocated to the remaining three quarters of 2014 at the corporate level. 
D)  in equal amounts allocated to the remaining three quarters of 2014 of the East Coast segment. 
A)  only at the consolidated report level at the end of the year. 
B)  entirely in the second quarter of 2014 in the East Coast operating segment. 
C)  in equal amounts allocated to the remaining three quarters of 2014 at the corporate level. 
D)  in equal amounts allocated to the remaining three quarters of 2014 of the East Coast segment.

Question 12

The following data relate to Falcon Corporation's industry segments:
   Required:
1. Which of Falcon's operating segments would be considered reporting segments under the "revenue" test?
2. Which of Falcon's operating segments would be considered reporting segments under the "asset" test?

Accepted Answer

Requirement 1
The test value is 10% of t

Question 13

What is the threshold for reporting a major customer?

Accepted Answer

A)  5 percent of revenues 
B)  5 percent of profits 
C)  10 percent of revenues 
D)  10 percent of profits 
A)  5 percent of revenues 
B)  5 percent of profits 
C)  10 percent of revenues 
D)  10 percent of profits

Question 14

On January 5, 2014, Eagle Corporation paid $50,000 in real estate taxes for the calendar year. In March of 2014, Eagle paid $180,000 for an annual machinery overhaul and $10,000 for the annual CPA audit fee. What amount was expensed for these items on Eagle's quarterly interim financial statements?

Accepted Answer

A)    
B)    
C)    
D)    
A)    
B)    
C)    
D)

Question 15

Which one of the following operating segment disclosures is not required by GAAP?

Accepted Answer

A)  Total Assets 
B)  Equity 
C)  Intersegment sales 
D)  Extraordinary items 
A)  Total Assets 
B)  Equity 
C)  Intersegment sales 
D)  Extraordinary items

Question 16

For internal decision-making purposes, Falcon Corporation identifies its industry segments by geographical area. For 2014, the total revenues of each segment are provided below. There are no intersegment revenues.
   Required:
1. Which operating segments will be considered reporting segments based on the revenue test?
2. What is the test value for determining whether a sufficient number of segments are reported?
3. What will be the minimum number of segments that must be reported?

Accepted Answer

Requirement 1
The reporting segments wil

Question 17

Jeale Corporation is preparing its interim financial statements for the third quarter of calendar 2014. The following information was provided for the preparation of the statements:
   Additional information:
At the end of the year, Jeale accrues its annual pension and depreciation expenses which amount to $60,000 and $42,000, respectively.
Required:
Prepare Jeale's interim income statement for the third quarter of calendar year 2014.

Accepted Answer

The answer of Jeale Corporation is preparing its interim financial...

Question 18

The estimated taxable income for Shebill Corporation on January 1, 2014, was $80,000, $100,000, $100,000, and $120,000, respectively, for each of the four quarters of 2014. Shebill's estimated annual effective tax rate was 30%. During the second quarter of 2014, the estimated annual effective tax rate was increased to 34%. Given only this information, Shebill's second quarter income tax expense was

Accepted Answer

A)  $30,000. 
B)  $34,000. 
C)  $37,200. 
D)  $61,200. 
A)  $30,000. 
B)  $34,000. 
C)  $37,200. 
D)  $61,200.

Question 19

For internal decision-making purposes, Geogh Corporation identifies its industry segments by geographical area. For 2014, the total revenues of each segment are provided below. There are no intersegment revenues.
   Required:
1. Which operating segments will be considered reporting segments based on the revenue test?
2. What is the test value for determining whether a sufficient number of segments are reported?
3. What will be the minimum number of segments that must be reported?

Accepted Answer

Requirement 1
The reporting segments wil

Question 20

Sandpiper Corporation paid $120,000 for annual property taxes on January 15, 2014, and $20,000 for building repair costs on March 10, 2014. Total repair expenses for the year were estimated to be $200,000, and are normally accrued during the year until incurred. What total amount of expense for these items was reported in Sandpiper's first quarter 2014 interim income statement?

Accepted Answer

A)  $ 50,000 
B)  $ 80,000 
C)  $100,000 
D)  $140,000 
A)  $ 50,000 
B)  $ 80,000 
C)  $100,000 
D)  $140,000

Which of the following is not a quantitative threshold for determining a reportable segment?

How does GAAP view interim accounting periods?

The following information was collected together for the Lawson Company relating to the preparation of their annual financial statements for 2011. For each item, indicate "yes" or "no" as to whether the item must be disclosed in the annual report.

Which one of the following operating segment information items is not directly named by GAAP to be reconciled to consolidated totals?

Cole Company has the following 2014 financial data: Cole Company should add segments if

GAAP requires disclosures for each reportable operating segment for each of the following, except for

Maxtil Corporation estimates its income by calendar quarter as follows for 2014: Required: Determine Maxtil's estimated effective tax rate.

For an operating segment to be considered a reporting segment under the revenue threshold, its reported revenue must be 10% or more of

Rollins Publishing has five operating segments, as summarized below: Required: Determine which of the operating segments of Rollins Publishing are reportable segments for the period shown.

Dott Corporation experienced a $100,000 extraordinary loss in the second quarter of 2014 in their East Coast operating segment. The loss should be recognized

The following data relate to Falcon Corporation's industry segments: Required: 1. Which of Falcon's operating segments would be considered reporting segments under the "revenue" test? 2. Which of Falcon's operating segments would be considered reporting segments under the "asset" test?

What is the threshold for reporting a major customer?

On January 5, 2014, Eagle Corporation paid $50,000 in real estate taxes for the calendar year. In March of 2014, Eagle paid $180,000 for an annual machinery overhaul and $10,000 for the annual CPA audit fee. What amount was expensed for these items on Eagle's quarterly interim financial statements?

Which one of the following operating segment disclosures is not required by GAAP?

Business Combinations

Stock Investments - Investor Accounting and Reporting

An Introduction to Consolidated Financial Statements

Consolidated Techniques and Procedures

Intercompany Profit Transactions Inventories

Intercompany Profit Transactions Plant Assets

Intercompany Profit Transactions Bonds

Consolidations - Changes in Ownership Interests

Indirect and Mutual Holdings

Subsidiary Preferred Stock, Consolidated Earnings Per Share, and Consolidated Income Taxation

Consolidation Theories, Push-Down Accounting, and Corporate Joint Ventures

Derivatives and Foreign Currency: Concepts and Common Transactions

Accounting for Derivatives and Hedging Activities

Foreign Currency Financial Statements

Partnerships - Formation, Operations, and Changes in Ownership Interests

Partnership Liquidation

Corporate Liquidations and Reorganizations

An Introduction to Accounting for State and Local Governmental Units

Accounting for State and Local Governmental Units - Governmental Funds

Accounting for State and Local Governmental Units - Proprietary and Fiduciary Funds

Accounting for Not-For-Profit Organizations

Estates and Trusts

Filters

Exam 15: Segment and Interim Financial Reporting

Which of the following is not a quantitative threshold for determining a reportable segment?

How does GAAP view interim accounting periods?

The following information was collected together for the Lawson Company relating to the preparation of their annual financial statements for 2011. For each item, indicate "yes" or "no" as to whether the item must be disclosed in the annual report.

Which one of the following operating segment information items is not directly named by GAAP to be reconciled to consolidated totals?

Cole Company has the following 2014 financial data: Cole Company should add segments if

GAAP requires disclosures for each reportable operating segment for each of the following, except for

Maxtil Corporation estimates its income by calendar quarter as follows for 2014: Required: Determine Maxtil's estimated effective tax rate.

For an operating segment to be considered a reporting segment under the revenue threshold, its reported revenue must be 10% or more of

Rollins Publishing has five operating segments, as summarized below: Required: Determine which of the operating segments of Rollins Publishing are reportable segments for the period shown.

Dott Corporation experienced a $100,000 extraordinary loss in the second quarter of 2014 in their East Coast operating segment. The loss should be recognized

The following data relate to Falcon Corporation's industry segments: Required: 1. Which of Falcon's operating segments would be considered reporting segments under the "revenue" test? 2. Which of Falcon's operating segments would be considered reporting segments under the "asset" test?

What is the threshold for reporting a major customer?

On January 5, 2014, Eagle Corporation paid $50,000 in real estate taxes for the calendar year. In March of 2014, Eagle paid $180,000 for an annual machinery overhaul and $10,000 for the annual CPA audit fee. What amount was expensed for these items on Eagle's quarterly interim financial statements?

Which one of the following operating segment disclosures is not required by GAAP?

Business Combinations

Stock Investments - Investor Accounting and Reporting

An Introduction to Consolidated Financial Statements

Consolidated Techniques and Procedures

Intercompany Profit Transactions Inventories

Intercompany Profit Transactions Plant Assets

Intercompany Profit Transactions Bonds

Consolidations - Changes in Ownership Interests

Indirect and Mutual Holdings

Subsidiary Preferred Stock, Consolidated Earnings Per Share, and Consolidated Income Taxation

Consolidation Theories, Push-Down Accounting, and Corporate Joint Ventures

Derivatives and Foreign Currency: Concepts and Common Transactions

Accounting for Derivatives and Hedging Activities

Foreign Currency Financial Statements

Partnerships - Formation, Operations, and Changes in Ownership Interests

Partnership Liquidation

Corporate Liquidations and Reorganizations

An Introduction to Accounting for State and Local Governmental Units

Accounting for State and Local Governmental Units - Governmental Funds

Accounting for State and Local Governmental Units - Proprietary and Fiduciary Funds

Accounting for Not-For-Profit Organizations

Estates and Trusts

Filters