Question
Kline Ltd operates solely within Western Australia. The chief operating decision-maker has identified five operating segments within the entity. These are Entertainment, Clothing, Food, Agriculture,
Kline Ltd operates solely within Western Australia. The chief operating decision-maker has identified five operating segments within the entity. These are Entertainment, Clothing, Food, Agriculture, and Consulting. Details for the year ending 30 June 2021 regarding each of the operating segments are provided below:
Revenue
Total Sales $ | |
Entertainment | 720 000 |
Clothing | 66 000 |
Food | 360 000 |
Agriculture | 120 000 |
Consulting | 48 000 |
Included in the sales revenue earned by the Entertainment operating segment was $144 000 sales made to the Food operating segment. This generated a profit on sale amounting to a total of $30 000.
Results
$ | |
Entertainment | (96 000) |
Clothing | (9 600) |
Food | 36 000 |
Agriculture | (6 000) |
Consulting | 7 200 |
Corporate Offices | (9 000) |
Assets
$ | |
Entertainment | 600 000 |
Clothing | 72 000 |
Food | 48 000 |
Agriculture | 174 000 |
Consulting | 42 000 |
Corporate Offices | 48 000 |
Required
Taking into account the information provided by the chief operating decision-maker as noted above, determine which operating segments are reportable according to the relevant accounting standard. Show all workings and offer explanations as required.
Step by Step Solution
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Answer Reportable segments are those operating segments whose Revenues internal or external are 10 o...
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Managerial Accounting
Authors: Carl S. Warren, James M. Reeve, Jonathan E. Duchac
10th Edition
B010IKDQZM
