operating segments

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Blanton Corporation is comprised of five operating segments. Information about each of these segments is as follows (in thousands):

Linens

Kitchen

Grocery

Furniture

Stationery

Sales to outsiders

$

47

$

253

$

22

$

61

$

14

Intersegment transfers

2

13

7

15

12

Interest revenue – outsiders

1

2

4

Interest revenue – intersegment

3

11

Operating expenses – outsiders

58

207

20

51

13

Operating expenses – intersegment

1

10

3

8

11

Interest expense

6

1

Income taxes

(2

)

5

2

3

12

Tangible assets

9

58

9

6

4

Intangible assets

2

4

Intersegment loans

4

3

Required:

A) Which operating segments are reportable under the revenue test?

B) What is the total amount of revenues in applying the revenue test?

C) Which operating segments are reportable under the profit or loss test?

D) In applying the profit or loss test, what is the minimum amount an operating segment must have in order to meet the profit or loss test for a reportable segment?

E) Which operating segments are reportable under the asset test?

F) In applying the asset test, what is the minimum amount an operating segment must have in order to meet the asset test for a reportable segment?

G) Which operating segments are reportable?

H) According to the test results for reportable segments, is there a sufficient number of reported segments or should any additional segments also be disclosed? Explain the reason for your conclusion.

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