2. Ecru Company has identified five industry segments: plastics, metals, lumber,
ID: 2597359 • Letter: 2
Question
2. Ecru Company has identified five industry segments: plastics, metals, lumber, paper, and finance.
It appropriately consolidated each of these segments in producing its annual financial statements. Information describing each segment (in thousands) follows:
Plastics
Metals
Lumber
Paper
Finance
Sales to outside parties
$
6,620
$
2,294
$
696
$
407
$
0
Intersegment transfers
140
161
126
138
0
Interest income from outside parties
0
31
18
0
39
Interest income from intersegment loans
0
0
0
0
189
Operating expenses
4,154
1,732
1,036
639
28
Interest expense
73
28
63
25
99
Tangible assets
1,427
3,136
464
711
164
Intangible assets
84
391
0
60
0
Intersegment loans (debt)
0
0
0
0
694
Ecru does not allocate its $1,310,000 in common expenses to the various segments.
Perform testing procedures to determine Ecru’s reportable operating segments.
I COMPLETED REVENUE TEST AND PROFIT OR LOSS TEST BUT I NEED HELP WITH Asset Test
a. Revenue test: DONE
b. Profit or loss test: DONE
c. Asset test: Need help
Complete this question by entering your answers in the tabs below.
Revenue Test
Segment
Revenues
Percentage
Reported or Not Reported
Plastics
6,760
62.3%
Reportable
Metals
2,486
22.9%
Reportable
Lumber
840
7.7%
Paper
545
5.0%
Finance
228
2.1%
Total
10,859
100.0%
Profit or Loss Test
Segment
Revenues
Expenses
Profit
Loss
Reported or Not Reported
Plastics
6,760
4,227
2,533
Reportable
Metals
2,486
1,760
726
Reportable
Lumber
840
1,099
(259)
Paper
545
664
(119)
Finance
228
127
101
Total
Asset Test
Perform asset test procedure to determine Ecru’s reportable operating segments. (Round your percentage answers to 1 decimal place. Enter your answers in thousands of dollars.)
Segment
Assets
Percentage
Reported or Not Reported
Plastics
1,511
?%
Reportable
Metals
3,527
?%
Reportable
Lumber
464
?%
?
Paper
771
?%
Reportable
Finance
?
?%
?
Total
Plastics
Metals
Lumber
Paper
Finance
Sales to outside parties
$
6,620
$
2,294
$
696
$
407
$
0
Intersegment transfers
140
161
126
138
0
Interest income from outside parties
0
31
18
0
39
Interest income from intersegment loans
0
0
0
0
189
Operating expenses
4,154
1,732
1,036
639
28
Interest expense
73
28
63
25
99
Tangible assets
1,427
3,136
464
711
164
Intangible assets
84
391
0
60
0
Intersegment loans (debt)
0
0
0
0
694
Explanation / Answer
Asset Test: Segment Assets Percentage Reportable or not Plastics 1511 23.5 Reportable Metals 3527 54.8 Reportable Lumber 464 7.2 Not reportable Paper 771 12.0 Reportable Finance 164 2.5 Not reportable Total 6437 100.0
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