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f) The reportable segments identified using the QT must report at least 75% of the external revenue. If not, other segments shall become reportable until the 75% requirement is met. g) A Major customer is an EXTERNAL Customerthat provides at least 10% of the external revenue. The identity of the segment and amount of revenue to the EC shall be disclosed. 1. Athena Company and its divisions are engaged solely in manufacturing operations. Athena identified its oper-ating segments for the year ended 2016. The following data pertain to the industries in which operations were conducted for the year ended December 31, 2016. SegmentsTotal RevenueOperating ProfitIdentifiable AssetsA 13,000,000 4,000,000 25,000,000 B 8,500,000 2,000,000 29,000,000 C 10,000,000 1,500,000 7,000,000 D 3,000,000 800,000 8,000,000 E 3,500,000 1,000,000 5,000,000 F 2,000,000 700,000 6,000,000 40,000,000 10,000,000 80,000,000 In its segment information for 2016, how many reportable segments does Athena have? a. Six b. Three c. Four d. Five 2.
Kanye Corporation and its divisions are engaged solely in manufacturing. The following data pertain to the in-dustries in which operations were conducted for the year ended December 31, 2016: Operating Profit (Loss) Division A 30,000,000 B 10,000,000 C (8,000,000) D (2,000,000) E 5,000,000
PAGE 10In its 2016 financial statements, Kanye Corporation should disclose an operating segment if operating profit or loss is at least 3. Cannon Company, a publicly owned corporation, is subject to the requirements for segment reporting. In its income statement for the year ended December 31, 2016, Cannon reported revenue of P60,000,000, operating expenses of P45,000,000 and net income of P15,000,000. Operating expenses include payroll costs of P5,000,000. Cannon’s combined identifiable assets of all industry segments at December 31, 2016 were P32,000,000. Total segment revenue was determined to be P70,000,000. 1.
What is the minimum amount of external revenue that must be reported by the reportable operating seg-ments? 2. What is the minimum amount an external customer to be regarded as a major customer? VII.INTERIM REPORTING a) Interim reports are financial statements prepared for an interim period, meaning shorter than a full year. b) A complete set may be prepared or condensed financial statements. c) Revenues shall be recognized using the same methods for the year. d) Expenses that generated the revenue shall be matched against the revenues reported. e) Expenses that are not directly associated are allocated or recognized as incurred. f) Gains and losses including losses on inventory writedown are not allocated but recognized immediately. g) Effects of changes in estimated and tax rates are recognized in the following interim period.