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Ferntree Experiences has two operating divisions, Winery and Restaurant. The two divisions have a marketing agreement to provide incentives to customers. The Winery division offers
Ferntree Experiences has two operating divisions, Winery and Restaurant. The two divisions have a marketing agreement to provide incentives to customers. The Winery division offers coupons good for meals at the restaurants and the Restaurant division offers coupons good for wine tastings and purchases. Annual profits are $39 million. The two divisions meet the requirements for segment disclosures.
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Problem 15-50 (Algo) Segment Reporting (LO 15-5) Ferntree Experiences has two operating divisions, Winery and Restaurant. The two divisions have a marketing agreement to provide incentives to customers. The Winery division offers coupons good for meals at the restaurants and the Restaurant division offers coupons good for wine tastings and purchases. Annual profits are $39 million. The two divisions meet the requirements for segment disclosures. Before the transactions are considered, revenues and costs in thousands of dollars) for the two divisions are as follows. Winery $52,500 Restaurant $26,250 Revenue Costs Profit After adjusting appropriately for the effect of the marketing agreement, the revenues and costs are as follows. Winery Restaurant Revenues Costs Profit $13,700 $10,300 The value of the coupons issued by the Restaurant Division was double the value of the coupons issued by the Winery Division. Required: What was the value of the coupons issued by the Winery Division? By the Restaurant Division? (Enter your answers in whole dollars not in thousands of dollars.) Value of coupons issued by Winery Division Value of coupons issued by Restaurant DivisionStep by Step Solution
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