ProCom Industries operates in several different industries. Total sales for ProCom are $14,000,000, and total common costs

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ProCom Industries operates in several different industries. Total sales for ProCom are $14,000,000, and total common costs are $6,500,000 for 2013. For internal reporting purposes, ProCom allocates common costs based on the ratio of a segment's sales to total sales. Additional information regarding the different segments follows:

ProCom Industries operates in several different industries. Total sales for

Instructions:
1. Compute the operating profit that would be reported internally for each of the four segments.
2. Comment on whether it is appropriate for ProCom to report segment information in the external financial statements using the same common cost allocation method that is used for internal reports.

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...
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Intermediate Accounting

ISBN: 978-0538479738

18th edition

Authors: Earl K. Stice, James D. Stice

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