To manage its operations, Famous Co. reports to top management on five different segments which are...

 

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To manage its operations, Famous Co. reports to top management on five different segments which are consolidated appropriately for the annual financial statements. Information about each segment included in the current year's consolidated statements appears in the table below: Metals $8.220 140 0- Lumber $2,790 170 30 Paper $ 830 130 10 Plastics Finance $ 450 140 -0- Sales to outside parties Intersegment revenues Interest income from outside parties Intersegment interest income Operating expenses Interest expense Tangible assets Intangible assets $-0 -0- 250 -0- 5,090 80 1,680 90 10- 2,100 20 3,880 470 -0- 1,390 170 410 -0- 750 40 730 60 210 20 110 140 870 -0- Famous Co. has $295,000 of corporate expenses that it does not allocate to the segments. Carry out: (a) the revenue test, (b) the profit and loss test, and (c) the asset test to determine which segments are separately reportables Clearly show the results of each test and your decision on each test. To manage its operations, Famous Co. reports to top management on five different segments which are consolidated appropriately for the annual financial statements. Information about each segment included in the current year's consolidated statements appears in the table below: Metals $8.220 140 0- Lumber $2,790 170 30 Paper $ 830 130 10 Plastics Finance $ 450 140 -0- Sales to outside parties Intersegment revenues Interest income from outside parties Intersegment interest income Operating expenses Interest expense Tangible assets Intangible assets $-0 -0- 250 -0- 5,090 80 1,680 90 10- 2,100 20 3,880 470 -0- 1,390 170 410 -0- 750 40 730 60 210 20 110 140 870 -0- Famous Co. has $295,000 of corporate expenses that it does not allocate to the segments. Carry out: (a) the revenue test, (b) the profit and loss test, and (c) the asset test to determine which segments are separately reportables Clearly show the results of each test and your decision on each test.

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