The Enterprise Standard Industrial Classification (SIC) coding scheme, a published classification of firms into separate industries, is commonly used in practice. SIC codes permit identification of company activities on three levels of detail. Two-digit codes designate a “major group,” three-digit codes designate an “industry group,” and four-digit codes identify a specific “industry.”

Use the Standard Industrial Classification Manual (published by the U.S. Government’s Office of Management and Budget in 1987) to answer the following questions.

(a) On what basis are SIC codes assigned to companies?

(b) Identify the major group⁄ industry group⁄ industry represented by the following codes.

  12       3571     75

271      7033    872

(c) Identify the SIC code for the following industries.

(1) Golfing equipment—manufacturing.

(2) Worm farms.

(3) Felt tip markers—manufacturing.

(4) Household appliance stores, electric or gas—retail.

(5) Advertising agencies.

(d) You are interested in examining several companies in the passenger airline industry. Determine the appropriate two-, three-, and four-digit SIC codes. Use Wards Business Directory of U.S. Private and Public Companies (Vol. 5) to compile a list of the five largest parent companies (by total sales) in the industry. Note: If Wards is not available, alternative sources include Standard & Poor’s Register of Corporations, Directors, and Executives, Standard & Poor’s Industry Surveys, and the Dun & Bradstreet Million Dollar Directory.