Theaccountant for Baxter Corporation has assigned most of the company's assets toits three segments as follows:

Electronics $1,760,000

Hardware 3,420,000

Plumbing 490,000

Total $5,670,000

Theunassigned assets consist of $430,000 of unallocated goodwill and $270,000 ofassets attached to the corporate headquarters. For internal decision-makingpurposes, goodwill is not assigned to the segments and the assets assigned tothe corporate headquarters are allocated equally to the operating segments.

Required:

1. What isthe proper threshold value to use in determining which of the operatingsegments shown above are reporting segments?

2. Which ofthe operating segments are considered reporting segments?