Ecru Company has identified five industry segments: plastics, metals, lumber, paper, and finance. ...
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Accounting
Ecru Company has identified five industry segments: plastics, metals, lumber, paper, and finance.
It appropriately consolidated each of these segments in producing its annual financial statements. Information describing each segment (in thousands) follows:
Plastics
Metals
Lumber
Paper
Finance
Sales to outside parties
$
6,470
$
2,219
$
666
$
377
$
0
Intersegment transfers
125
146
111
123
0
Interest income from outside parties
0
25
12
0
33
Interest income from intersegment loans
0
0
0
0
174
Operating expenses
4,034
1,672
976
609
22
Interest expense
67
22
57
28
93
Tangible assets
1,370
3,061
389
636
134
Intangible assets
78
376
0
54
0
Intersegment loans (debt)
0
0
0
0
679
Ecru does not allocate its $1,280,000 in common expenses to the various segments.
Perform testing procedures to determine Ecrus reportable operating segments.
Revenue test:
Profit or loss test:
Asset test:
Answer & Explanation
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