Retal Sales and Wholesale Sales are the only divislons of Terra Company. The following Information was gathered for the two divisions for the current year. 14 Wholesale DivISson Retall Division Operating income Operating assets $ 6,400,000 $36,400,000 $2,900,000 $16,400,000 The company has $1,400,000 in operating assets that are not assigned to ether of the divisions and $240.000 in corporate expenses that are not reflected in the Information Multiple Choice 176% 35.27% 16.72% The answer cannot be determined using the information provided

Retal Sales and Wholesale Sales are the only divislons of Terra Company. The following Information was gathered for the two divisions for the current year. 14 Wholesale DivISson Retall Division Operating income Operating assets $ 6,400,000 $36,400,000 $2,900,000 $16,400,000 The company has $1,400,000 in operating assets that are not assigned to ether of the divisions and $240.000 in corporate expenses that are not reflected in the Information Multiple Choice 176% 35.27% 16.72% The answer cannot be determined using the information provided

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter10: Evaluating Decentralized Operations

Section: Chapter Questions

Problem 5E: Service department charges In divisional income statements prepared for Demopolis Company, the...

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GREEN COMPANY has two divisions: Del Sur Division and Del Norte Division. The following data are for the most recent operating period: Total Company Del Sur Division Del Norte DivisionSales P 418,000 P 193,000 P 225,000   Variable expenses P 130,880 P 79,130 P 51,750   Traceable fixed expenses P 186,000 P 77,000 P 109,000   Common fixed expense P 79,420 P 36,670 P 42,750    The bookkeeper allocated common fixed expenses to the divisions on the basis of sales. Required: a. What is the company's overall break-even sales? b. Determine the break-even point for Del Sur Division c. Determine the break-even point for Del Norte Division.
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Mesopotamian Materials Inc. (MMI) has two decentralized divisions (Ur and Babylon) that have decision making responsibility over the amount of resources invested in their divisions. Recent financial extracts for both divisions are presented below: Ur Babylon Fixed assets, gross $2,500 $4,000 Accumulated depreciation $1,500 $1,200 Other assets $500 $750 Liabilities $500 $1,000 Sales $6,750 $7,200 Net income after tax* $743 $1,008 Average age of fixed assets (years) 15 5 *Net income is after tax but before interest  MMI's weighted average cost of capital (WACC) is 11.5%. The MMI measures division performance based on the book value of net assets. The producer price index 15 years ago was 100, 116 five years ago, and currently is 125.  Which is true, when fixed asset costs are adjusted upward for inflation?
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Exoplex Industries Inc. is a diversified aerospace company, including two operating divisions, Semiconductors and Navigational Systems. Condensed divisional income statements, which involve no intracompany transfers and include a breakdown of expenses into variable and fixed components, are as follows: Exoplex Industries Inc.Divisional Income StatementsFor the Year Ended December 31, 20Y8 SemiconductorsDivision NavigationalSystemsDivision Total Sales: 2,240 units × $396 per unit $887,040 $887,040 3,675 units × $590 per unit $2,168,250 2,168,250 Total sales $887,040 $2,168,250 $3,055,290 Expenses: Variable: 2,240 units × $232 per unit $(519,680) $(519,680) 3,675 units × $472* per unit $(1,734,600) (1,734,600) Fixed (220,000) (325,000) (545,000) Total expenses $(739,680) $(2,059,600) $(2,799,280) Operating income $147,360 $108,650…
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Orioles Construction & Paving expanded its business by purchasing Alcott Maintenance, a division that provides road maintenance services. The division was purchased three years ago for $3,130,000 and has been identified as a reporting unit. The net assets for the division including goodwill are as follows: Cash $229,000 Accounts Receivables 295,000 Inventory 767,000 Property, Plant & Equipment 898,000 Goodwill 1,307,000 Accounts Payable (137,000 ) Unearned Revenue (70,000 ) Net assets, at carrying amounts $3,289,000 The fair value of the Alcott Maintenance Division reporting unit as a whole is estimated to be $3,008,000. Management determines that the unit’s value in use is $3,117,000. Prepare any appropriate journal entries for goodwill impairment assuming that Oriole Construction & Paving is reporting under ASPE. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.…
The following information pertains to the Liberty Company and its divisions for the year ended December 31, 2014 : Sales to unaffiliated customers P10,000,000Inter- segment sales of products similar to those sold to unaffiliated customers 2,000,000Liberty Company all its divisions are engaged solely in manufacturing operations. Liberty has a reportable segment if the segment's revenue will total to what amount?