高级会计学(第10版)习题答案ch14-beams10e-sm

Chapter14

SEGMENTANDINTERIMFINANCIALREPORTING

AnswerstoQuestions

1

2

3

4

5

6

7

8

Anoperatingsegmentisacomponentofanenterprise:(1)thatengagesinbusinessactivitiesfromwhichitmayearnrevenuesandincurexpenses,eitherinternalorexternal;(2)whoseoperatingresultsareregularlyreviewedbytheenterprise’schiefoperatingdecisionmakerand(3)forwhichdiscretefinancialinformationisavailable.

Areportablesegmentisanoperatingsegment,eithersingleoraggregated,forwhichinformationhastobereportedunderFASBStatementNo.131.Anoperatingsegmentisareportablesegmentif(a)itsrevenueis10percentormoreofthecombinedrevenueofalloperatingsegments,(b)itsabsoluteoperatingprofitorlossis10percentormoreofthegreaterofcombinedoperatingprofitofallsegmentsthathaveoperatingprofitorcombinedoperatinglossesofallsegmentsthathavelosses,or(c)itsidentifiableassetsare10percentormoreofthecombinedidentifiableassetsofalloperatingsegments.

Segmentsnotmeetingoneofthesetestsaresubjecttoareevaluation,andpossibleaggregation,ifthecombinedrevenuefromsalestoexternalcustomersofallreportablesegmentsislessthan75percentofconsolidatedrevenue.Segmentsthatarenotreportablesegmentsarecombinedwithotherbusinessactivitiesandreportedunderan“allother”category.

The10percentrevenuetestappliestothe$480,000.RevenueforpurposesofFASBStatementNo.131includesrevenuefrombothexternalandintersegmentcustomers.

Anindustrysegmentisareportablesegmentunderthe10percentoperatingprofittestifitsoperatingprofitorloss,inabsoluteamount,equalsorisgreaterthanthegreaterofcombinedoperatingprofitsforalloperatingsegmentshavingoperatingprofitsorcombinedoperatinglossesforalloperatingsegmentshavingoperatinglosses.

Asegmentisareportablesegmentunderthe10percentassettestifitsassetsare10percentormoreofthecombinedassetsofalloperatingsegments.Theallocationofgeneralcorporateassetsdependsontheinternaloperationsoftheenterprise.Thekeyistheassetfiguregiventothechiefoperatingdecisionmakeronwhichheorsheevaluatesperformance.Ifcorporateassetsarenotallocated,theybecomepartofthereconciliationbetweenthereportablesegments’assetsandconsolidatedassets.

Asegmentisareportablesegmentunderthe10percentrevenuetestifitsintersegmentandexternalsalesis10percentormoreofthecombinedintersegmentandexternalsalesofalltheoperatingsegments.

No.Ifthecombinedrevenuefromsalestoexternalcustomersislessthan75percentoftotalconsolidatedrevenues,additionaloperatingsegmentsmustbeidentifiedasreportablesegmentsuntilthe75percenttestismet.Eithersomeoftheremainingsegmentsmustbeaggregated,iftheymeettheaggregationcriteria,sothatthecombinedsegmentmeetsthematerialitycriteriaof10%,oroneormoreofthefiveoperatingsegmentsthatwerenotreportablesegmentsunderthe10percenttestsmustbeidentifiedasreportablesegments.

14-2SegmentandInterimFinancialReporting

9Thefollowinginformationmustbedisclosedforreportablesegmentsandfortheremainderoftheenterprise’soperatingsegmentsandotherbusinessactivitiesintheaggregate:

aRevenue,withseparateamountstounaffiliatedandaffiliatedcustomers,anddisclosureofthebasis

ofaccountingforintersegmentsales.

bOperatingprofitorloss,basedontheinformationreviewedbythechiefoperatingofficer.

cIdentifiableassetsforeachreportablesegment.

dInterestrevenue

eInterestexpense

fAggregateamountofdepreciation,depletion,andamortizationexpense.

gUnusualitemsasdescribedinparagraph26ofAPBOpinionNo.30.

hEquityinthenetincomeofinvesteesaccountedforbytheequitymethod.

iIncometaxexpenseorbenefit.

jExtraordinaryitems.

kSignificantnoncashitemsotherthandepreciation,depletion,andamortization.

10Iftheenterpriseissegmentedonageographicbasis,completesegmentinformationwouldbesuppliedbycountryofoperation.Ifadifferentcriteriaisusedforsegmentation,morelimitedgeographicinformationissupplied.Revenuesandlonglivedassetsattributedtothecountryofdomicileandallforeignoperationsaredisclosed.Anysinglecountrywithmaterialoperationsexistmustalsobedisclosedseparately.

11Thefactandamountofrevenuefromeachcustomermustbedisclosedif10percentormoreofanenterprise’srevenueisderivedfromthatcustomer.If10percentormoreofanenterprise’srevenueisderivedfromsalestothefederalgovernment,ortoastate,local,orforeigngovernmentalunit,thatfactandtheamountofrevenuemustbedisclosed.Theidentityofthesegmentmakingsuchsalesmustbedisclosed,butthecustomerneednotbeidentifiedbyname.

12TherequirementsofFASBStatementNo.131doapplytointerimfinancialstatements.Likeotheraspectsofinterimreporting,segmentdisclosureismorelimitedintheinterimreportsthanintheannualreports.Requireddisclosureforeachreportablesegmentintheinterimreportsinclude:(1)revenuesfromexternalcustomers,(2)intersegmentrevenues,(3)ameasureofsegmentprofitorloss,(4)totalassetsforwhichtherehasbeenamaterialchangesincetheamountdisclosedintheannualreport,(5)adescriptionofanychangesinthebasisforsegmentationorthebasisofmeasurementofsegmentprofitorloss,(6)areconciliationoftotalreportablesegmentprofitorlossandconsolidatedincomebeforeincometaxes.

13Anannualeffectivetaxrateiscomputedasthesumofestimatedincometaxesforeachquarteroftheyear,dividedbytheestimatedincomefortheyear.Thisapproachspreadsanyprogressionintaxratesovertheentireyearinaccordancewiththeintegraltheoryofinterimreporting.

14Thediscretetheoryassumesthateachquarterisaseparateandindependentaccountingperiodthatstandsalone.Bycontrast,theintegraltheorytreatseachinterimperiodasanessentialpartofeachannualperiod.TheintegraltheoryisrequiredunderGAAPreportingforinterimreports.

15APBOpinionNo.28specifiesthatminimumdisclosuresforinterimreportsshouldincludegrossrevenues,provisionforincometaxes,extraordinaryitemsandcumulative-effect-typechangesonanet-of-taxbasis,andnetincomeandrelatedEPSamountsasbasicreportingitems.Inaddition,disclosuresarerequiredofseasonalcostandrevenue,significantchangesinincometaxestimates,orchangesinfinancialposition,andmaterialcontingencies,extraordinaryandunusualorinfrequentlyoccurringitems.

Chapter14

SOLUTIONSTOEXERCISES

SolutionE14-1

1d

2a

3d

4

5

6

14-3

b

d

b

SolutionE14-2

Revenuetest:10%ofcombinedrevenues(totalsales)=$68,800,000

Thefoodserviceindustry,coppermine,andchemicalindustryare

reportablesegmentsundertherevenuetestbecausetheyeachhaverevenuein

excessof$68,800,000.

Operatingprofittest:10%ofthegreaterofthecombinedoperatingprofitof

allindustrieshavingoperatingprofit($88,500,000)orthecombinedoperating

lossofallindustrieshavingoperatinglosses($25,500,000).

Thefoodserviceindustry,coppermine,chemicalindustry,and

agriculturalproductsindustryarereportablesegmentsbecausetheyeachhave

operatingprofitorlossinexcess

Assettest:10%ofcombinedassets

corporateassets)=$60,500,000.

of$8,850,000.

($638,000,000totalassetsless$33,000,000

Thefoodserviceindustryandchemicalindustryarereportablesegments

becausetheyhaveassetsinexcessof$60,500,000.

Reportablesegments(thosethatmeetatleastoneofthetests):foodservice

industry,coppermine,chemicalindustry,andagriculturalproductsindustry.

SolutionE14-3

Revenuetests

1

10%revenuetest:

Concreteandstoneproducts

Construction

Lumberandwoodproducts

Buildingmaterials

Other

75%revenuetest:

Concreteandstoneproducts

Construction

Lumberandwoodproducts

Buildingmaterials

Other

RevenuefromAffiliatedandUnaffiliatedCustomers

$200,000

500,000

900,000

500,000

50,000$2,150,000

CombinedRevenuefromReportableSegmentstoUnaffiliatedCustomers

$500,000

500,000

300,000

$1,300,000

ReportableSegmentTestValue$215,000

no

yes

yes

yes

no

CombinedRevenuefrom

AllSegmentsto

UnaffiliatedCustomers

$200,000

500,000

500,000

300,000

50,000$1,550,000

Sincethe$1,300,000combinedrevenuefromreportablesegmentsto

unaffiliatedcustomersisgreaterthan75%of$1,550,000revenueforall

14-4SegmentandInterimFinancialReporting

unaffiliatedcustomers($1,162,500),noadditionalsegmentshavetobe

reported.

2Schedulefordisclosingrevenuebysegment:

Unaffiliated

sales

Affiliatedsales

TotalSales

Construction

$500,000

$500,000

LumberandWood

$500,000

$400,000$900,000

Building

$300,000

$200,000$500,000

Other

$250,000

$250,000

Totals

$1,550,000

600,000$2,150,000

3

Reconciliationofsegmentrevenuetocorporaterevenue

$1,900,000

250,000

(600,000)$1,550,000

Totalrevenueofreportablesegments

Otherrevenue

Eliminationsofintersegmentrevenue

Totalconsolidatedrevenue

SolutionE14-4

WorldwideCorporation

SegmentRevenuefor2008

(inthousands)

United

States

Salestounaffiliatedcustomers$50,000

Intersegmentsales15,000

Total$65,000

Sincerevenuefromreportableoperatingsegmentsof

75%ofconsolidatedrevenue($89,000),noadditional

RevenueReconciliation:

ReportableSegments

Othersegments

Intersegmentrevenue

Consolidatedrevenue

Other

Canada$18,000

8,000$26,000

Foreign$21,000

4,000$25,000

$68,000isgreaterthan

segmentsneedbereported.

$91,000

25,000

(27,000)$89,000

Chapter14

SolutionE14-5

14-5

[AICPAadapted]

1

2

3

4

5

6

7

8

c

Revenuetestvalue=$3,275IndustriesA,B,C,andE

Operatingprofittestvalue=$580IndustriesA,B,C,andE

Identifiableassetstestvalue=$6,750IndustriesA,B,C,D,andE

d

Tenpercentofcombinedrevenuesofallindustrysegments.

b

Revenuetestvalue:10%ofsalestounaffiliated($2,000)andaffiliated

($600)customers=$260

b

OnlyBeckandDGhavetotalrevenues>10%of$83,000combinedrevenues:

Beck$12,000totalrevenue>$8,300

DG$59,000totalrevenue>$8,300

d

Ifsalestoasinglecustomertotal10%ormoreofGrum’sreportedrevenues($50,000,00010%),majorcustomerdatashouldbedisclosed.

a

Ifrevenuesgeneratedbyforeignoperationsinonecountryarematerial

(10%ormore)ofconsolidatedrevenue,Grumshouldreportinformation

aboutthatcountry’sforeignoperations.

c

Thematerialitycriteriaforreportingasegmentbasedonrevenueis10

percentoftotal(bothexternalandintersegment,eliminatingb)revenue

(notincomeeliminatinga)ofalloperatingsegments(notjustthose

reportingaprofit,eliminatingd).

b

Salestoothersegmentsarealwaysincludedinsegmentincome.Theother

threeoptionsgenerallywouldnotbeincludedbutanyofthemcouldbe

included.Inclusionwoulddependonwhetheritwasincludedinthe

performancereportevaluatedbythechiefoperatingdecisionmaker.

4a

1stQuarter$120,000

34%40,800

0$40,800

[AICPAadapted]

14-6

SolutionE14-6

SegmentandInterimFinancialReporting

1

2

3

c

Japanistheonlyforeignsegmentthathassegmentalrevenues(including

intersegmentrevenues)ofover

c

Assets

UnitedStates$100,000<

Canada15,000<

Germany17,000<

Japan18,000<

Mexico4,000<

Otherforeign3,000

Totalforeign$157,000

10%oftotalsegmentrevenuesof$126,000.

TestValue

$15,700

$15,700

15,700

15,700

15,700

ReportableGeographicArea

yes

no

yes

yes

no

Thetestvaluetodeterminereportabilityis10percentof

consolidated

segmentassetsof$157,000,nottotalconsolidatedassets.

b

assettests,

UnitedStatesonallthreetests,Japanontherevenueand

andGermanyontheoperatingprofitandassettests.

SolutionE14-7

1

2

3

4

d

c

d

Incomeyeartodate

Taxrate

Less:Taxinpriorreturnperiods

Quarterlyperiodtaxexpense

a

Estimatedtotaltaxesof$26,15023.77%

2ndQuarter$210,000

30%63,000

40,800$22,200

$110,000estimatedpretaxincome=

SolutionE14-8

1

2

3

b

Theinventorylosswasnotexpectedtobetemporary,andtherefore,the

declinewasrecognizedinthefirstperiod.Thesubsequentrecoveryto

theoriginalcostisrecognizedinthethirdperiod.

b

Theextraordinarylossof$70,000hastobedisclosed,andtheannual

insurancepremiumhastobeallocated$25,000perquarter.

d

Thefull$360,000lossisincludedinthesecondquarterinterimreport

becausethelossispermanent.

Chapter14

14-7

Anextraordinarylossisallocatedtothequartertowhichitrelates.

Inthiscasethe$300,000extraordinarylossisassignedtothethird

quarter.

5

a

Undertheintegraltheoryeachquarterlyperiodisanintegralpartof

eachannualperiod.Thus,propertytaxesof$20,000($80,00025%)and

executivebonusesof$80,000($320,00025%)shouldbeallocatedto

eachofthefourquarters.

SolutionE14-9

EndicottCorporation

ScheduleofIncomebyQuarterfor2008

Incomeyear-to-date

Quarterlyperiod

income

Incometaxexpense*

Netincome

1st

Quarter

$30,000

$30,000

(8,350)

$21,650

2nd

Quarter

$70,000

$40,000

(11,133)

$28,867

3rd

Quarter

$110,000

$40,000

(11,133)

$28,867

4th

Quarter

$150,000

$40,000

(11,134)

$28,866

Year

2006

$150,000

$150,000

(41,750)

$108,250

*Incometaxexpensecomputations:

1stQuarter

2ndQuarter

3rdQuarter

4thQuarter

$30,000.278333=$8,350

$70,000.278333=$19,483-$8,350=$11,133

$110,000.278333=$30,616-$19,483=$11,133

$150,000.278333=$41,750-$30,616=$11,134

SolutionE14-10

Currentcosttoreplace4,000unitsat$8

Historicalcostofinventoryliquidated4,000unitsat$5

$32,000

20,000

Adjustmenttocostofsales[4,000units($8-$5)]

Costofsales

Adjustedcostofsalesforthefirstquarter

12,000

550,000

$562,000

14-8

SOLUTIONSTOPROBLEMS

SegmentandInterimFinancialReporting

SolutionP14-1

1

Reportablesegments

Revenuetest($600,000+$105,000)10%=$70,500Reportablesegments:

Food

Chemical

Beverages

$350,000

$150,000

$72,000

Operatingprofittest($85,000+$10,000)10%=$9,500

Reportablesegments:Food

Chemical

Beverages

Assettest$645,00010%=$64,500

Food

Chemical

Reportablesegments:

2Reportablesegmentstest

Testvalue$600,000consolidatedsales75%=$450,000

Unaffiliatedsales:Food

Chemical

Beverages

Total

Salesbyreportablesegments($472,000)aregreaterthanthe$450,000

valueandnoadditionalreportablesegmentsarerequired.

$45,000

$23,000

$18,000

$310,000

$150,000

$300,000 110,000 62,000

$472,000

test

SolutionP14-2

1Reportablesegmentsunderthe10%revenuetest:

Testvalueis10%of$1,158,000totalsales,or$115,800.Reportable

industrysegmentsincludetheapparel,furniture,lumberandwood

products,andtextilessegments.

2

3

Testvaluefor75%revenuetestisthe

fromsalestounaffiliatedcustomerssegmentsof$892,00075%=

Reportablesegments:

Apparel

Furniture

Lumberandwoodproducts

Textiles

Total

combinedrevenue

byallindustry

$669,000

$164,000

208,000

175,000

50,000$597,000

Salestounaffiliatedcustomersbythereportableindustrysegmentsof

$597,000islessthanthe$669,000testvalue.Therefore,additionalsegmentsmustbeidentifiedasreportablesegments.Theconstructionindustry,asclosesttothe10%criteria,shouldbeincludedasareportablesegment.

Undertheassumptionthattobaccoandpapersharethemajorityoftheir

operatingcharacteristicstheywouldbecombinedintoonesegmentthat

Chapter14

14-9

nowmeetsthe10%testandcomplieswiththe75%criteria.Construction

wouldnolongerneedtobereported.Notetodiscloseinformationabout

segmentdata:

Salesto

Unaffiliated

Customers

$164,000

183,000

208,000

175,000

50,000

112,000$892,000

SalestoAffiliated Customers

Apparel

Tobaccoandpaper

Furniture

Lumberandwoodproducts

Textiles

Othersegments

Totalrevenue

---

$6,000

90,000

170,000

---$266,000

ReconciliationofSegmentRevenuetoConsolidatedRevenue:

Reportablesegmentrevenue

Otherrevenue

Intersegmentrevenue

Consolidatedrevenue

TotalSales

$164,000

183,000

214,000

265,000

220,000

112,000$1,158,000

$1,046,000

112,000

(266,000)$892,000

14-10

SegmentandInterimFinancialReporting

SolutionP14-3

1

2

Operatingsegments

Revenuetest

(foreigngeographic

areas):

TestValue

($240,00010%)

$24,000

24,000

24,000

24,000

24,000

Revenue

$24,000

20,000

22,000

25,000

149,000$240,000

<

<

>

Canada

Mexico

Brazil

SouthAfrica

UnitedStates

Assettest

TestValuea

Assets

$30,000

19,000

20,000

31,000

150,000

($250,00010%)

Canada

Mexico

Brazil

SouthAfrica

UnitedStates

<<

$25,000

25,000

25,000

25,000

25,000

aTotalsegmentassets=$250,000.

Profittest

Canada

Mexico

Brazil

SouthAfrica

UnitedStates

Allfivegeographic

Profit

$6,000

8,000

5,000

7,000

24,000

segments

(Canada,

TestValuea

($50,00010%)

$5,000

5,000

5,000

5,000

5,000

Mexico,Brazil,South

theUnitedStates)arereportablesegments.

Reportable

Geographic

Area

yes

no

no

yes

yes

Reportable

yes

no

no

yes

yes

Reportableyesyesyesyesyes

Africa,and

(50,000)

$190,000

$50,000

0

0

0

55,000

Chapter14

SolutionP14-3(continued)

3Daton-PauloCorporation

ScheduleofOperationsinDifferentGeographic

fortheyearendedDecember31,2008

Salestounaffil-

iatedcustomers

Intersegment

transfers

Totalrevenue

Operatingprofit

Identifiable

assets

Reconciliations:

$149,000

$24,000

$150,000

United

States

$120,000

29,000

$20,000

$8,000

$19,000

Mexico$20,000

$22,000

$5,000

$20,000

Brazil$22,000

$25,000

$7,000

$31,000

SouthAfrica

$15,000

10,000

Revenue:

Totalrevenueofreportablesegments

Otherrevenues

Eliminationofintersegmentrevenues

Totalconsolidatedrevenues

ProfitorLoss:

Totalprofitorlossforreportablesegments

Otherprofitorloss

Eliminationofintersegmentprofitandloss

Unallocatedamounts

Consolidatedincomebeforetaxes

Assets:

Totalassetsforreportablesegments

Otherassets

Consolidatedtotal

14-11

Segments

Total

$190,000

$240,000

$50,000

$250,000

Canada

$13,000

11,000

$24,000

$6,000

$30,000

$240,000

0

$50,000

$250,000

$305,000

14-12

SolutionP14-4

1Reportablesegments:

Revenuetest

Foods

Softdrinks

Distilledspirits

Cosmetics

Packaging

Other(4minorsegments)

Totalrevenue

75%revenuetest

Foods

Softdrinks

Distilledspirits

Cosmetics

Packaging

Other(4minorsegments)

SegmentandInterimFinancialReporting

SalestoAffiliated

andUnaffiliated

Customers

$210

1,060

570

200

120

240$2,400

TestValue<$240>240>240<240<240

Reportable Segment

no

yes

yes

no

no

SalestoUnaffiliatedCustomers

All

Segments

$180

900

550

200

110

240$2,180

Reportable

Segments

$900

550

$1,450

Since$1,450<(75%$2,180),otherreportablesegmentsmustbeidentifiedtobringthetotalrevenuefromunaffiliatedcustomersforreportablesegmentsupto$1,635.

Ifnofurtheraggregationispossible,alogicalapproachisto

includecosmetics,thenextlargestsegmentintermsofsalesto

unaffiliatedcustomers.

Iffurtheraggregationofsomeoftheotherwisenon-reportable

segmentswerepossible(theymetthemajorityoftheaggregation

criteria),acombinedsegmentmaythenmeetthereportabilitycriteria

andwouldbereportedinsteadofcosmetics.

Thetest:$900+$550+$200=$1,650

Since$1,650>$1,635,thereportablesegmentsaresoftdrinks,

distilledspirits,andcosmetics.

Chapter14

SolutionP14-4(continued)

14-13

2

Mid-AmericaCorporation

ScheduleofSalestoAffiliatedandUnaffiliatedCustomers

bySegments

fortheyearendedDecember31,2008

SoftDrinks

Distilled Spirits

Salestounaffiliated

customers

$900

$550

Salestoaffiliated

customers

160

20

Totalrevenue

$1,060

$570

Reconciliation:

Revenuefromreportablesegments

Otherrevenue

Eliminationofintercompanyrevenue

Consolidatedrevenue

Cosmetics$200

$200

Other

Segments$530 40

$570

Totals$2,180 220

$2,400

$1,830

570

(220)$2,180

3

Mid-AmericaCorporation

DisclosureofRevenuefromDomesticandForeignOperations

fortheyearendedDecember31,2008

Salestounaffiliatedcustomers

Interareasales

Totalrevenue

UnitedStates$1,850

200$2,050

TotalForeign$330

20$350

Japan

$250

$250

14-14

SolutionP14-5

1Reportablesegments

Revenuetest

Segment

Food

Packing

Textile

Allother

Operatingprofit

Segment

Food

Packing

Textile

Allother

Assettest

Segment

Food

Packing

Textile

Allother

IndustrySegmentRevenue

$1,010,000

560,000

630,000

400,000

$2,600,000

test

Operating

Profit

$110,000

110,000

30,000

75,000$325,000

Operating Assets

$750,000

500,000

550,000

400,000$2,200,000

SegmentandInterimFinancialReporting

TestValue

(10%$2,600,000)

$260,000

260,000

260,000

Operating

Reportable

Segment

yes

yes

yes

<

TestValue

(10%$325,000)

$32,500

32,500

32,500

Reportable Segment

yes

yes

no

Segment

TestValue

(10%$2,125,000)$220,000 220,000 220,000

Reportable Segment

yes

yes

yes

50

300

$5$25$75

14-15

Chapter14

SolutionP14-5(continued)

ColbyCompany

OperationsinDifferentSegments

atorfortheyearendedDecember31,2008

(DatainThousandsofDollars)

2

Revenues

Salestounaffili-

atedcustomers

Intersegmentsales

atmarket

Segmentsales

Total

FoodIndustry

$950

60

1,010

$1,010

PackingIndustry

$500

60

560

$560

TextileSegments

$300

30

330

$630

Foreign

Operation

$250

$300

All

Other

$400

400

$400

Totals

$2,400

200$2,600

Operatingprofit

Segmentoperating

profit$110$110

Incomebeforetaxes$110$110

Assets

Identifiableassets$700$500

Reconciliationofrevenue:

Revenuefromreportablesegments

Othersegmentrevenue

Intersegmenteliminations

$5$25$75$325

$325$200$400$2,125

$2,200

400

(200)

Incomefromequityinvestees100

Consolidatedrevenue$2,500

Reconciliationofincome:

Reportablesegmentincome$250

Othersegmentincome