ACCT 557 Week 7 Homework Problem 1 and 2

ACCT 557 Intermediate Accounting III – DeVry

Question 1: Plastics Inc. is a company that operates in four different divisions. The following information relating to each segment is available for 2013.

Sales revenue Cost of goods sold Operating expenses Total expenses Operating profit (loss) Identifiable assets
Bottles $ 65,000 $ 26,000 $8,000 $ 34,000 $31,000 $ 66,000
Containers $ 95,000 $ 62,000 $ 48,000 $ 110,000 $ (15,000) $ 80,000
Dollhouses $ 620,000 $ 353,000 $140,000 $ 493,000 $ 127,000 $ 640,000
Silverware $18,000 $ 8,000 $ 6,500 $14,500 $3,500 $36,000

Sales of segments Containers and Dollhouses included intersegment sales of $30,000 and $150,000, respectively.

Required
Determine which of the segments are reportable based on the following:
Revenue Test
Operating profit (loss) test
Identifiable assets test

Question 2:

The following information pertains to Walrus Inc.

Cash

$ 60,000

Accounts receivable

$ 170,000

Inventory

$ 100,000

Plant assets (net)

$ 582,000

Total assets

$ 912,000

Accounts payable

$ 110,000

Accrued taxes and expenses payable

$ 42,000

Long-term debt

$ 120,000

Common stock ($10 par)

$ 260,000

Paid-in capital in excess of par

$ 50,000

Retained earnings

$ 330,000

Total equities

$ 912,000

Net sales (all on credit)

$ 2,000,000

Cost of goods sold

$ 1,400,000

Net income

$ 120,000

Required:

Compute the following:

(ignore Avg for balance sheet accounts)

CCT 557 Week 7 Homework Problem 1 and 2

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