The following income statement and balance sheet information is available for the operating

segments of Bogart, Inc.

Operating Segments

$($In millions of dollars$)$

Grant

Stewart

Kelly

Flynn

Cagney

Total

Revenue

$$2,076\mathrm{.}0$

Cost of goods sold

$(626\mathrm{.}8)$

Gross margin

$1\mathrm{.}449\mathrm{.}2$

Depreciation expense

$(193\mathrm{.}8)$

Administrative expense

$(174\mathrm{.}3)$

Operating profit before taxes

$$1,081\mathrm{.}1$

$ $350\mathrm{.}0$

$(104\mathrm{.}5)$

$245\mathrm{.}5$

$(45\mathrm{.}9)$

$(93\mathrm{.}5)$

$ $106\mathrm{.}1$

$ $304\mathrm{.}0$

$(174\mathrm{.}1)$

$129$ g

$(61\mathrm{.}2)$

$(34\mathrm{.}0)$

$

$34\mathrm{.}7$

$ $195\mathrm{.}0$

$(104\mathrm{.}5)$

$90\mathrm{.}5$

$(25\mathrm{.}5)$

$(12\mathrm{.}8)$

$ $52\mathrm{.}2$

$$1\mathrm{.}375\mathrm{.}0$

$(731\mathrm{.}2)$

$643\mathrm{.}8$

$(183\mathrm{.}6)$

$(110\mathrm{.}5)$

$ $349\mathrm{.}7$

$ $4\mathrm{.}300\mathrm{.}0$

$(1,741\mathrm{.}1)$

$2\mathrm{.}558\mathrm{.}9$

$(510\mathrm{.}0)$

$(425\mathrm{.}1)$

$ $1\mathrm{.}623\mathrm{.}8$

Total assets

$$3,000\mathrm{.}0$

$ $430\mathrm{.}0$

$ $945\mathrm{.}0$

$ $325\mathrm{.}0$

$$2\mathrm{.}300\mathrm{.}0$

$ $7\mathrm{.}000\mathrm{.}0$

The segments do not sell goods or services to one another. The Flynn and Cagney segments

have similar economic characteristics. products, processes, customers, distribution method,

and regulatory environments.

Required:

$1.$ Explain why U$.$S$.$ GAP requires a company to disclose information about its business segments.

$2.$ How does a firm define an operating segment under U$.$S$.$ GAAP?

$3.$ Identify Bogart's reportable segments. Aggregate segments where possible. Explain your

logic for determining the reportable segments.

Answer rating: 100% (QA)

1 US GAAP requires a company to disclose information about its business segments to provide users of financial statements with relevant and reliable i... View the full answer