Taft Corporation operates primarily in the United States. However, a few years a
ID: 2429496 • Letter: T
Question
Taft Corporation operates primarily in the United States. However, a few years ago, it opened a plant in Spain to produce merchandise to sell there. This foreign operation has been so successful that during the past 24 months the company started a manufacturing plant in Italy and another in Greece. Financial information for each of these facilities follows: Spain Italy Greece Sales Intersegment transfers Operating expenses Interest expense Income taxes Long-lived assets $ 215,000 $ 640,000490,000 100,000 230,000 35,000 50,000 140,000 212,000 32,000 83,000 131,000 100,800 246,000 45,000 35,000 190,000 The company's domestic (U.S.) operations reported the following information for the current year: Sales Intersegment transfers Operating expenses Interest expense Income taxes Long-lived assets $4,660,000 507,000 2,490,000 176,000 899,00e 2,280,0e0 to unaffiliated customers Taft has adopted the following criteria for determining the materiality of an individual foreign country: a. Calculate sales to unaffiliated customers within a country and as a percent of the consolidated sales b. Calculate long-lived assets within a country and as a percentage of the long-lived assets. c. Apply Taft's materiality tests to identify the countries which are 10 percent or more of consolidated sales or consolidated long-lived assets to be reported separately.Explanation / Answer
A. Revenue-wise breakup
B. Long lived assets based breakup
C. Countries to be reported having 10% or more of consolidated sales: United States , Italy
Countries to be reported having 10% or more of long-lived assets: United States.
COUNTRY REVENUES ($,000) % TO TOTAL United States 4660 77.61 Spain 215 3.58 Italy 640 10.66 Greece 490 8.15 Total 6005 100Related Questions
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