Exam 13: Segment and Interim Reporting

In 20X6 and 20X7,each of Putney Company's four operating segments met one of the three quantitative tests for segment reporting.In 20X8,Segment B failed to qualify under the prescribed tests because of abnormal financial conditions.The other three segments qualified for reporting.For 20X8,Segment B:

On June 30,20X0,Bow Corporation incurred a $150,000 net loss from disposal of a business component.Also on June 30,20X0,Bow paid $50,000 for property taxes assessed for the calendar year 20X0.What amount of the preceding items should be included in the determination of Bow's net income or loss for the six-month interim period ended June 30,20X0?

Wakefield Company uses a perpetual inventory system.In August,it sold 2,000 units from its LIFO-base inventory,which had originally cost $35 per unit.The replacement cost is expected to be $45 per unit.The company is planning to reduce its inventory and expects to replace only 1,500 of these units by December 31,the end of its fiscal year.The company replaced 1,500 units in November at an actual cost of $50 per unit. -Based on the preceding information,in the entry to record the replacement of the 1,500 units in November,Inventory will be debited for:

Fisher Company pays its executives a bonus of 4 percent of income before deducting the bonus and income taxes.For the quarter ended March 31,20X1,Fisher had income before the bonus and income tax of $10,000,000.For the year ended December 31,20X1,Fisher estimates that its income before bonus and income taxes will be $50,000,000.For the quarter ended March 31,20X1,what is the amount of the bonus that Fisher should deduct on its income statement?

Dragon Company has two reportable segments,A and B.Segment A made $3,000,000 of sales to external customers and $200,000 of sales to other operating segments.Segment B made sales of $5,000,000 to external customers and $1,200,000 of sales to other operating segments.Dragon Company reported $9,600,000 of revenues on its consolidated income statement.What calculation below correctly determines whether Dragon Company's reportable segments satisfy the 75% revenue test?

If a company changes the method it uses to compute the allowance for uncollectible accounts receivable because more recent information has become available,how is this change in method accounted for?

How would a company report a change in an accounting principle made on the last day of the third quarter?

Missoula Corporation disposed of one of its segments in the second quarter and incurred a gain from disposal of discontinued segment of $600,000,net of taxes.What is the effect of this gain from disposal of discontinued segment?

ASC 280 uses a(n)________ approach to the definition of segments.

Frahm Company incurred a first quarter operating loss before income tax effect of $4,000,000.This is a normal occurrence for Frahm because of seasonal fluctuations.Experience has demonstrated the income earned during the remaining quarters far exceeds the first quarter losses each year.Frahm estimates its annual income tax rate will be 30 percent.What net loss should Frahm report for the first quarter?

On March 15,20X9,Clarion Company paid property taxes of $60,000 on its factory building for calendar year 20X9.On July 1,20X9,Clarion made $40,000 in unanticipated repairs to its machinery.The repairs will benefit operations for the remainder of the calendar year.What total amount of these expenses should be included in Clarion's quarterly income statement for the three months ended September 30,20X9?

Reno Corporation disposed of one of its segments in the second quarter and incurred a gain from disposal of discontinued segment of $300,000,net of taxes.What is the effect of this gain from disposal of discontinued segment?

Zeus Corporation has determined that it has 15 reportable operating segments.In order to comply with the standard for segment disclosures,Zeus Corporation should do which of the following?

Mason Company paid its annual property taxes of $240,000 on February 15,20X9.Mason also anticipates that its annual repairs expense for 20X9 will be $1,200,000.This amount is usually incurred and paid in July and August when operations are shut down so that machinery and equipment can be repaired.What amount should Mason deduct for property taxes and repairs in each quarter for 20X9?

The management approach to the definition of segments for financial reporting expects a company to: I.Report disaggregated information on the same organizational basis as used by the company's internal decision makers. II.Report disaggregated information for at least ten segments.

William Corporation,which has a fiscal year ending January 31,had the following pretax accounting income and estimated effective annual income tax rates for the first three quarters of the year ended January 31,20X8: William's income tax expense in its interim income statement for the third quarter are:

On March 15,20X7,Barrel Company paid property taxes of $120,000 on its factory building for calendar year 20X7.On July 1,20X7,Barrel made $20,000 in unanticipated repairs to its machinery.The repairs will benefit operations for the remainder of the calendar year.What total amount of these expenses should be included in Barrel's quarterly income statement for the three months ended September 30,20X7?

Forge Company,a calendar-year entity,had 6,000 units in its beginning inventory for 20X8.On December 31,20X7,applying the lower-of-cost-or-market (NRV)principle,the units had been adjusted down to $470 per unit from an actual cost of $510 per unit.It was the lower of cost or market (NRV).No additional units were purchased during 20X8.The following additional information is provided for 20X8: Forge does not have sufficient experience with the seasonal market for its inventory units and assumes that any reductions in market value during the year will be permanent. -Based on the preceding information,the cost of goods sold for the first quarter is:

Trimester Corporation's revenue for the year ended December 31,20X8,was as follows: Trimester has a reportable operating segment if that segment's revenue exceeds:

ASC 280,Disclosure about Segments of an Enterprise and Related Information,has taken what has been referred to as a "management approach" to the definition of a segment and the allocation of costs to a segment. Required: a)What is meant by a management approach? How does this concept of a management approach impact the decision to disclose information? b)How are decisions about cost allocation handled in segment disclosures?