Question 1

What is the appropriate treatment in an interim financial report for variances arising from the use of a standard costing system?

Accepted Answer

A)  The variances are always ignored for interim reporting. 
B)  The variances should always be reflected in gross profit on an interim income statement. 
C)  The variances expected to be absorbed by year-end should not be reflected in the interim statement. 
D)  The variances should always be reflected in the interim income statement but not the interim balance sheet. 
E)  The variances should only be reflected in the interim balance sheet. 
A)  The variances are always ignored for interim reporting. 
B)  The variances should always be reflected in gross profit on an interim income statement. 
C)  The variances expected to be absorbed by year-end should not be reflected in the interim statement. 
D)  The variances should always be reflected in the interim income statement but not the interim balance sheet. 
E)  The variances should only be reflected in the interim balance sheet. C

Question 2

Dean Hardware, Inc. is comprised of five operating segments. Information about each of these segments is as follows (in thousands; Intersegment loans are receivables):  
-In applying the profit or loss test, what is the minimum amount an operating segment must have in order to meet the profit or loss test for a reportable segment?

Accepted Answer

A)  $8.2. 
B)  $9.0 
C)  $10.4. 
D)  $13.0. 
E)  $82.0. 
A)  $8.2. 
B)  $9.0 
C)  $10.4. 
D)  $13.0. 
E)  $82.0. D

Question 3

How should revenues be recognized in interim periods?

Accepted Answer

A)  In the same way as they are recognized on an annual basis. 
B)  On the cash basis. 
C)  On an annualized basis. 
D)  On a seasonal basis. 
E)  There are no revenues recognized in interim periods. 
A)  In the same way as they are recognized on an annual basis. 
B)  On the cash basis. 
C)  On an annualized basis. 
D)  On a seasonal basis. 
E)  There are no revenues recognized in interim periods. A

Question 4

When defining a reportable segment, which of the following conditions would be sufficient to allow a company to combine two operating segments for purposes of testing?

Accepted Answer

A)  The products sold by each segment are produced in the same plant. 
B)  Both segments have several customers in common. 
C)  The segments may sell different products, but they have a similar production process. 
D)  Both segments are required to adhere to U.S. Department of Labor regulations regarding immigration laws. 
E)  Both segments are owned by the same parent company. 
A)  The products sold by each segment are produced in the same plant. 
B)  Both segments have several customers in common. 
C)  The segments may sell different products, but they have a similar production process. 
D)  Both segments are required to adhere to U.S. Department of Labor regulations regarding immigration laws. 
E)  Both segments are owned by the same parent company.

Question 5

Which of the following is a criterion for determining whether an operating segment is separately reportable?

Accepted Answer

A)  An operating segment's assets are 10 percent or more of combined segment assets. 
B)  An operating segment's assets are 10 percent or more of consolidated assets. 
C)  An operating segment's assets are 10 percent or more of combined segment liabilities. 
D)  An operating segment's assets are 10 percent or more of consolidated liabilities. 
E)  An operating segment's assets are 10 percent or more of corporate assets. 
A)  An operating segment's assets are 10 percent or more of combined segment assets. 
B)  An operating segment's assets are 10 percent or more of consolidated assets. 
C)  An operating segment's assets are 10 percent or more of combined segment liabilities. 
D)  An operating segment's assets are 10 percent or more of consolidated liabilities. 
E)  An operating segment's assets are 10 percent or more of corporate assets.

Question 6

What information does U.S. GAAP require to be disclosed for a major customer?

Accepted Answer

A)  The identity of the customer. 
B)  The operating segment reporting sales to the customer. 
C)  The geographic area of the customer. 
D)  The percentage of sales derived from the customer. 
E)  The length of time the customer has been a customer of the company. 
A)  The identity of the customer. 
B)  The operating segment reporting sales to the customer. 
C)  The geographic area of the customer. 
D)  The percentage of sales derived from the customer. 
E)  The length of time the customer has been a customer of the company.

Question 7

When totaling the revenues to use as the basis for the 75% rule, what is the 75% hurdle that must be exceeded by the revenues of the reportable segments?

Accepted Answer

A)  $1,670,000. 
B)  $12,525,000. 
C)  $15,487,500. 
D)  $16,700,000. 
E)  $20,650,000. 
A)  $1,670,000. 
B)  $12,525,000. 
C)  $15,487,500. 
D)  $16,700,000. 
E)  $20,650,000.

Question 8

Which of the following would be an acceptable grouping for a U.S. company to provide information by geographic area?

Accepted Answer

A)  United States, All Other Countries. 
B)  United States, Europe, Taiwan. 
C)  United States, Asia, Germany. 
D)  United States, Central America, Mexico, Germany. 
E)  South America, Spain, All Other Countries. 
A)  United States, All Other Countries. 
B)  United States, Europe, Taiwan. 
C)  United States, Asia, Germany. 
D)  United States, Central America, Mexico, Germany. 
E)  South America, Spain, All Other Countries.

Question 9

Peterson Corporation has three operating segments with the following information:  
-What is the minimum amount of revenue an operating segment must have to be considered a reportable segment?

Accepted Answer

A)  $3,900. 
B)  $4,000. 
C)  $4,100. 
D)  $4,200. 
E)  $4,400. 
A)  $3,900. 
B)  $4,000. 
C)  $4,100. 
D)  $4,200. 
E)  $4,400.

Question 10

According to U.S. GAAP, how should common costs be allocated to individual segments to determine segment profit or loss?

Accepted Answer

U.S. GAAP does not require common costs

Question 11

Which of the following is not one of the criteria management should consider in determining whether business activities and environments of an operating segment are similar?

Accepted Answer

A)  The geographical location of the operations. 
B)  The nature of the production process. 
C)  The distribution methods. 
D)  The nature of the regulatory environment, if applicable. 
E)  The type or class of customer. 
A)  The geographical location of the operations. 
B)  The nature of the production process. 
C)  The distribution methods. 
D)  The nature of the regulatory environment, if applicable. 
E)  The type or class of customer.

Question 12

What approach is used, according to U.S. GAAP, for determination of how a business is divided into segments?

Accepted Answer

The management appro

Question 13

Kaycee Corporation's revenues for the year ended December 31, 2010, were as follows:
Consolidated Revenue per the Income Statement: $1,200,000
Upstream Intersegment Sales: $180,000
Downstream Intersegment Sales: $60,000
For purposes of the Revenue Test, what amount will be used as the benchmark for determining whether a segment is reportable?

Accepted Answer

A)  $24,000. 
B)  $120,000. 
C)  $138,000. 
D)  $144,000. 
E)  $0 
A)  $24,000. 
B)  $120,000. 
C)  $138,000. 
D)  $144,000. 
E)  $0

Question 14

The Fratilo Co. had three operating segments with the following information: $$\begin{array} { | l | r | r | c | } 
\hline & \text { Pens } & \underline { \text { Pencils } } & \underline { \text { Erasers } } \
\hline \text { Sales to outsiders } & \$ 11,200 & \$ 5,600 & \$ 8,400 \
\hline \text { Intersegment revenues } & 840 & 1,400 & 1,960 \
\hline
\end{array}$$ In addition, revenues generated at corporate headquarters are $1,400.
-Combined segment revenues are calculated to be

Accepted Answer

A)  $29,400. 
B)  $25,200. 
C)  $26,600. 
D)  $28,000. 
E)  $27,300. 
A)  $29,400. 
B)  $25,200. 
C)  $26,600. 
D)  $28,000. 
E)  $27,300.

Question 15

Dean Hardware, Inc. is comprised of five operating segments. Information about each of these segments is as follows (in thousands; Intersegment loans are receivables):  
-Which operating segments are reportable under the profit or loss test?

Accepted Answer

A)  Rakes, Pails, and Shovels. 
B)  Rakes, Pails, Shovels, and Hardware. 
C)  Rakes, Pails, and Hardware. 
D)  Rakes, Pails, Shovels, Hardware, and Accessories. 
E)  Pails and Hardware. 
A)  Rakes, Pails, and Shovels. 
B)  Rakes, Pails, Shovels, and Hardware. 
C)  Rakes, Pails, and Hardware. 
D)  Rakes, Pails, Shovels, Hardware, and Accessories. 
E)  Pails and Hardware.

Question 16

What is the major objective of segment reporting?

Accepted Answer

According to U.S. GAAP, the objective of

Question 17

The following information for Urbanski Corporation relates to the three months ending June 30, 2011:
Answer:   Urbanski uses the LIFO method to account for inventory, and expects at least 15,000 units to be on hand in the ending inventory at year-end. Purchases made in the last six months are expected to cost an average of $18 per unit.
-Prepare the journal entries to reflect the sales and cost of goods sold, assuming Urbanski expects to maintain 11,000 units in inventory at year-end.

Accepted Answer

Journal Entries to Record Sale

Question 18

Why are quarterly financial statements required to be published for publicly traded companies in the U.S.?

Accepted Answer

Publicly traded U.S. companies

Question 19

Provo, Inc. has an estimated annual tax rate of 35 percent in the first quarter of 2011. Pretax income for the first quarter was $300,000. At the end of the second quarter of 2011, Provo expects the annual tax rate to be 32 percent because of anticipated tax credits. Pretax income for the second quarter was $350,000. Assume no items in either quarter requiring the net-of-tax presentation.
-How much income tax expense is recognized in the second quarter of 2011?

Accepted Answer

A)  $103,000. 
B)  $104,000. 
C)  $112,000. 
D)  $122,500. 
E)  $208,000. 
A)  $103,000. 
B)  $104,000. 
C)  $112,000. 
D)  $122,500. 
E)  $208,000.

Question 20

How are extraordinary gains reported in a third quarter interim financial report?

Accepted Answer

A)  Recognized at year-end only. 
B)  Recognized in the first quarter. 
C)  Recognized ratably over the first three quarters. 
D)  Recognized in the third quarter. 
E)  Ignored. 
A)  Recognized at year-end only. 
B)  Recognized in the first quarter. 
C)  Recognized ratably over the first three quarters. 
D)  Recognized in the third quarter. 
E)  Ignored.

What is the appropriate treatment in an interim financial report for variances arising from the use of a standard costing system?

How should revenues be recognized in interim periods?

When defining a reportable segment, which of the following conditions would be sufficient to allow a company to combine two operating segments for purposes of testing?

Which of the following is a criterion for determining whether an operating segment is separately reportable?

What information does U.S. GAAP require to be disclosed for a major customer?

When totaling the revenues to use as the basis for the 75% rule, what is the 75% hurdle that must be exceeded by the revenues of the reportable segments?

Which of the following would be an acceptable grouping for a U.S. company to provide information by geographic area?

Peterson Corporation has three operating segments with the following information: -What is the minimum amount of revenue an operating segment must have to be considered a reportable segment?

According to U.S. GAAP, how should common costs be allocated to individual segments to determine segment profit or loss?

Which of the following is not one of the criteria management should consider in determining whether business activities and environments of an operating segment are similar?

What approach is used, according to U.S. GAAP, for determination of how a business is divided into segments?

The Fratilo Co. had three operating segments with the following information: Pens Sales to outsiders \ 11,200 \ 5,600 \ 8,400 Intersegment revenues 840 1,400 1,960 In addition, revenues generated at corporate headquarters are $1,400. -Combined segment revenues are calculated to be

Dean Hardware, Inc. is comprised of five operating segments. Information about each of these segments is as follows (in thousands; Intersegment loans are receivables): -Which operating segments are reportable under the profit or loss test?

What is the major objective of segment reporting?

Why are quarterly financial statements required to be published for publicly traded companies in the U.S.?

How are extraordinary gains reported in a third quarter interim financial report?

The Equity Method of Accounting for Investments

Consolidation of Financial Information

Consolidations-Subsequent to the Date of Acquisition

Consolidated Financial Statements and Outside Ownership

Consolidated Financial Statements - Intra-Entity Asset Transactions

Variable Interest Entities, Intra-Entity Debt, Consolidated Cash Flo

Consolidated Financial Statements - Ownership Patterns and Income

Foreign Currency Transactions and Hedging Foreign Exchange Risk

Translation of Foreign Currency Financial Statements

Worldwide Accounting Diversity and International Standards

Financial Reporting and the Securities and Exchange Commission

Accounting for Legal Reorganizations and Liquidations

Partnerships: Formation and Operations

Partnerships: Termination and Liquidation

Accounting for State and Local Governments

Accounting for State and Local Governments

Accounting and Reporting for Private Not-For-Profit Organizations

Accounting for Estates and Trusts

Filters

Exam 8: Segment and Interim Reporting

What is the appropriate treatment in an interim financial report for variances arising from the use of a standard costing system?

How should revenues be recognized in interim periods?

When defining a reportable segment, which of the following conditions would be sufficient to allow a company to combine two operating segments for purposes of testing?

Which of the following is a criterion for determining whether an operating segment is separately reportable?

What information does U.S. GAAP require to be disclosed for a major customer?

When totaling the revenues to use as the basis for the 75% rule, what is the 75% hurdle that must be exceeded by the revenues of the reportable segments?

Which of the following would be an acceptable grouping for a U.S. company to provide information by geographic area?

Peterson Corporation has three operating segments with the following information: -What is the minimum amount of revenue an operating segment must have to be considered a reportable segment?

According to U.S. GAAP, how should common costs be allocated to individual segments to determine segment profit or loss?

Which of the following is not one of the criteria management should consider in determining whether business activities and environments of an operating segment are similar?

What approach is used, according to U.S. GAAP, for determination of how a business is divided into segments?

The Fratilo Co. had three operating segments with the following information: Pens Sales to outsiders \ 11,200 \ 5,600 \ 8,400 Intersegment revenues 840 1,400 1,960 In addition, revenues generated at corporate headquarters are $1,400. -Combined segment revenues are calculated to be

Dean Hardware, Inc. is comprised of five operating segments. Information about each of these segments is as follows (in thousands; Intersegment loans are receivables): -Which operating segments are reportable under the profit or loss test?

What is the major objective of segment reporting?

Why are quarterly financial statements required to be published for publicly traded companies in the U.S.?

How are extraordinary gains reported in a third quarter interim financial report?

The Equity Method of Accounting for Investments

Consolidation of Financial Information

Consolidations-Subsequent to the Date of Acquisition

Consolidated Financial Statements and Outside Ownership

Consolidated Financial Statements - Intra-Entity Asset Transactions

Variable Interest Entities, Intra-Entity Debt, Consolidated Cash Flo

Consolidated Financial Statements - Ownership Patterns and Income

Foreign Currency Transactions and Hedging Foreign Exchange Risk

Translation of Foreign Currency Financial Statements

Worldwide Accounting Diversity and International Standards

Financial Reporting and the Securities and Exchange Commission

Accounting for Legal Reorganizations and Liquidations

Partnerships: Formation and Operations

Partnerships: Termination and Liquidation

Accounting for State and Local Governments

Accounting for State and Local Governments

Accounting and Reporting for Private Not-For-Profit Organizations

Accounting for Estates and Trusts

Filters