West Corporation reported the following consolidated data fo

West Corporation reported the following consolidated data for 20X2 Sales Consolidated income before taxes Total assets $768,000 137,000 1,290,000 Data reported for West\'s four operating divisions are as follows Sales to outsiders Intersegment sales Traceable costs Assets Division A Division B ion CDivision D $50,000 20,000 91,000 84,000 $240,000 40,000 254,000 481,000 $330,000 12,000 299,000 509,000 $148,000 99,000 114,000 Intersegment sales are priced at cost, and all goods have been subsequently sold to nonaffiliates. Some joint production costs are allocated to the divisions based on total sales. These joint costs were $42,000 in 20X2. The company\'s corporate center had $29,000 of general corporate expenses and $129,000 of assets that the chief operating decision maker did not use in making the decision regarding the operating segments Required Each of the following items is unrelated to the others a. The divisions are industry segments. (1) Prepare a segmental disclosure worksheet for the company. (Do not round your intermediate calculations.)

Solution

a.1.

WN 1. Allocated-

A - $42,000 * (280,000/840,000) = $14,000

B - $42,000 * (148,000/840,000) = $7,400

C - $42,000 * (342,000/840,000) = $17,100

D - $42,000 * (70,000/840,000) = $3,500

2. Schedules showing segments are reportable-

i). Separately reportable if segment revenue greater than or equal to (Combined Revenue * .10) = $840,000* .10 = $84,000

ii). Separately reportable if separate segment profit or loss greater than or equals to $7,950 (total segment profit i.e. A,B and C of $79,500 * 0.10)

iii). Separately reportable if segment assets greater than or equal to $118,800 (total segment assets $1,118,800 * 0.10)

A,B and C are separately reportable.

b.

i. separately reportable if revenue to outside greater than or equal to $76,800 ( Combined revenue of $768,000 * .10)

ii. Separately reporatble if long- lived, productive assets, which are one-half of total assets, are greater than or equal to (Total Assets $1,188,000/2 = $594,000 * .10) = $59,400

Foreign countries B and C are separately reportable.

	Operating Segments
	A	B	C	D	Corporate Admin.	Combined	Intersegment Elimination	Consolidated
Revenues:
Sales to unaffilated customers
lated customers	240,000	148,000	330,000	50,000		768,000		768,000
Intersegment sales	40,000		12,000	20,000		72,000	(72,000)
Total Revenue	280,000	148,000	342,000	70,000		840,000	(72,000)	768,000
Operating Costs:
Traceable costs	(254,000)	(99,000)	(299,000)	(91,000)		(707,000)	72,000	(635,000)
Allocated [WN1]	(14,000)	(7,400)	(17,100)	(3,500)		(42,000)		(42,000)
Segment profit/(loss)	12,000	41,600	25,900	(24,500)		91,000		91,000
Other items:
General Corporate expenses					(29,000)	(29,000)		(29,000)
Income from continuing operations	12,000	41,600	25,900	(24,500)	(29,000)	62,000		62,000
Assets:
Segment	481,000	114,000	509,000	84,000		1,188,000		1,188,000
General Corporate					129,000	129,000		129,000
Total Assets	481,000	114,000	509,000	84,000	129,000	1,317,000		1,317,000