Franklin Corporation is a diversified company that operates in five different industries: A, B, C, D, and E. The following information relating to each segment is available for 2023. Sales of segments B and C included intersegment sales of $20,000 and $100,000, respectively.

Instructions

a. Determine which of the segments are reportable under IFRS based on each of the following:

1. Revenue test

2. Operating profit (loss) test

3. Assets test

b. Prepare the necessary disclosures.

c. The corporation’s accountant recently commented, “If I have to disclose our segments individually, the only people who will gain are our competitors and the only people who will lose are our present shareholders.” Evaluate this comment.

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Sales Cost of goods sold Operating expenses Total expenses Operating profit (loss) Assets Liabilities A $40,000 19,000 10,000 29,000 $11,000 $35,000 $22,000 B $ 80,000 50,000 40,000 90,000 $ (10,000) 60,000 $ 31,000 $580,000 270,000 235,000 505,000 $ 75,000 $500,000 $443,000 D $35,000 19,000 12,000 31,000 $ 4,000 $65,000 $12,000 E $55,000 30,000 18,000 48,000 $ 7,000 $50,000 $29,000