Exam 15: Segment and Interim Financial Reporting

Dott Corporation experienced a $100,000 extraordinary loss in the second quarter of 2011 in their East Coast operating segment.The loss should be recognized

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. _____ 1.Names of major customers for all reportable segments _____ 2.Interest revenue and expense for all reportable segments _____ 3.Cost of Goods Sold for all reportable segments _____ 4.Depreciation expense and amortization expense for all reportable segments _____ 5.Revenue from external customers for all reportable segments _____ 6.The basis for aggregating any operating segments to arrive at reporting segments _____ 7.Income tax expense (or benefit)for all reportable segments _____ 8.Total assets for all reportable segments _____ 9.Type of product or service for all reportable segments _____ 10.Extraordinary items for all reportable segments

In general, GAAP encourages the identification of reportable segments based on the following:

Maxtil Corporation estimates its income by calendar quarter as follows for 2011: Required: Determine Maxtil's estimated effective tax rate.

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

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

Krull Corporation is preparing its interim financial statements for the third quarter of calendar 2011. The following trial balance information is available for third quarter: Additional information: At the end of the year, Krull distributes annual employee bonuses and charitable donations that are estimated at $40,000, and $12,000, respectively.The cost of goods sold includes the liquidation of a $45,000 base layer in inventory that Krull will restore in the fourth quarter at a cost of $75,000.Effective corporate tax rate for 2011 is 32%. Required: Prepare Krull's interim income statement for the third quarter of calendar 2011.

The following table is provided in the disclosures for interim reporting by Bigg Company, regarding the location of their assets. Based on the table, which of the following statements is true?

Osprin Corporation has three operating segments, as summarized below: Required: 1.Using the revenue test, what is the minimum amount of revenue of a reportable segment? 2.Using the operating profit or loss test, what is the minimum amount of operating profit or loss of a reportable segment? 3.Using the asset test, what is the minimum amount of assets of a reportable segment? 4.Based on the three tests, which segments will be separately reported?

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

On January 5, 2011, Eagle Corporation paid $50,000 in real estate taxes for the calendar year.In March of 2011, 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?

For internal decision-making purposes, Elom Corporation's operating segments have been identified as follows: Corporate assets are typically allocated back evenly to the segments for internal analysis purposes. Required: 1.In applying the "asset" test to identify reporting segments, what is the test value for Elom Corporation? 2.Using the "asset" test, which of Elom's operating segments will also be reporting segments?

For internal decision-making purposes, Dashwood Corporation's operating segments have been identified as follows: Revenues of the segments are external, with the exception of tools, which sold $400,000 to other segments, and Appliances, which sold $200,000 to other segments. Required: 1.In applying the "revenue" test to identify reporting segments, what is the test value for Dashwood Corporation? 2.Using the "revenue" test, which of Dashwood's operating segments will also be reportable segments?

Sandpiper Corporation paid $120,000 for annual property taxes on January 15, 2011, and $20,000 for building repair costs on March 10, 2011.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 2011 interim income statement?

The following data relate to Elle Corporation's industry segments.(Elle HQ represents the corporate headquarters).All other segments are geographical sales segments. Required: 1.Prepare a report which reconciles the reportable segment profits to total consolidated profits assuming that corporate expenses are not allocated to the operating segments. 2.Prepare a report which reconciles the reportable segment profits to total consolidated profits assuming that corporate expenses are allocated evenly among the operating segments.

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.

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?

For internal decision-making purposes, Geogh Corporation identifies its industry segments by geographical area.For 2011, 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?

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

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