Question
Exercise 15-33 Segment Reporting (LO 15-5) (Not sure why this is wrong, please include calculations so I can find where I messed up) Perth Corporation
Exercise 15-33 Segment Reporting (LO 15-5)
(Not sure why this is wrong, please include calculations so I can find where I messed up)
Perth Corporation has two operating divisions, a casino and a hotel. The two divisions meet the requirements for segment disclosures. Before transactions between the two divisions are considered, revenues and costs are as follows:
Casino | Hotel | |||||
Revenues | $ | 34,000,000 | $ | 29,000,000 | ||
Costs | 17,000,000 | 11,000,000 | ||||
The casino and the hotel have a joint marketing arrangement by which the hotel gives coupons redeemable at casino slot machines and the casino gives discount coupons good for stays at the hotel. The value of the coupons for the slot machines redeemed during the past year totaled $5,000,000. The discount coupons redeemed at the hotel totaled $1,000,000. As of the end of the year, all coupons for the current year expired.
Required:
What are the operating profits for each division considering the effects of the costs arising from the joint marketing agreement? (Enter your answers in thousands.)
Exercise 15-33 Segment Reporting (LO 15-5) Perth Corporation has two operating divisions, a casino and a hotel. The two divisions meet the requirements for segment disclosures. Before transactions between the two divisions are considered, revenues and costs are as follows Casino Hotel Revenues Costs $34,000,000 $29,000,000 17,000.000 11000.000 The casino and the hotel have a joint marketing arrangement by which the hotel gives coupons redeemable at casino slot machines and the casino gives discount coupons good for stays at the hotel. The value of the coupons for the slot machines redeemed during the past year totaled $5,000,000. The discount coupons redeemed at the hotel totaled $1,000,000. As of the end of the year, all coupons for the current year expired. Required What are the operating profits for each division considering the effects of the costs arising from the joint marketing agreement? (Enter your answers in thousands.) Answer is complete but not entirely correct. Operating Profits 21,000,000 S 14,000,000 Casino Hotel Shar Tell me File Home Insert Page Layout Formulas Data Review View Help Calibri Conditional Formatting- Format as Table Cell Styles Custom Cells Editing Paste .0 .00 00 .0 Font Styles Clipboard Alignment Number D24 Required What are the operating profits for each division considering the effects of the costs arising from the joint marketing agreement? (Enter your answers in thousands.) 10 Operating Profits 21,000,000 14,000,000 Casino 12 13 14 15 Revenue 16 Outsider Revenue 17 Transfer price 18 19 Less: 20 Outside Costs 21 Transfer price Hotel Hotel Item Casino 34,000,000 $ 5,000,000 $ 39,000,000 $ 29,000,000 1,000,000 30,000,000 Total Revenue 17,000,000$ 1,000,000 $ 18,000,000 $ 21,000,000 $ 11,000,000 5,000,000 16,000,000 14,000,000 Total Costs 23 Operating profit before tax$ 24 25 26
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