Laurence Inocencio October 08, 2022

Accoun ng 18 – Quiz 1 Opera ng Segment and Interim Financial Repor ng

Test I. Mul ple Choice Problem
1. B
Sales To Una liated Customer P20,000,000
Intersegment Sales 6,000,000
Combined Revenue P26,000,000
Mul ply By: 10%
Test Of Reportable Segment P 2,600,000

2. B
Total Revenue P83,000
Mul ply By: 10%
Test of Reportable Segment P 8,300

Reportable Segments:
Bix P 12,000
Dil 59,000
P 71,000

3. A
External Revenue P50,000,000
Mul ply by: 10%
Minimum Amount P 5,000,000

4. D
External Revenue P50,000,000
Mul ply by: 75%
Minimum Amount P 37,500,000

ti
ti
ti
ti






ti



ffi

ti

ti

ti

 5. C
Sales of Segment Z P3,000,000
Traceable Expense (1,500,000)
Indirect expense 1,800,000 x 3/12 (450,000)
Interest expense 600,000 x 3/12 (150,000)
Income tax expense 400,000 x 3/12 (100,000)
P 800,000

6. D
Total Segment Pro t including Intersegment Pro t = P500,000

7. D
Revenue Test: P2,000,000 x .10 = P200,000
• Segment 1 and 3

Pro t (loss) Test: P300,000 x .10 = P 30,000

Pro t Total = P200,000 + P20,000 + P70,000 + P10,000 = P300,000 (HIGHER)
Loss Total = P30,000 + P25,000 + P20,000 + P25,000 = P100,000
• Segment 1, 3 and 4

Asset Test: P1,500,000 x .10 = P150,000

• Segment 1, 3 and 5

Revenue of Reportable Segments:

Segment 1 P 620,000
3 340,000
4 190,000
5 180,000
Total Revenue P1,330,000

fi
fi

fi

fi

 External Revenue Ra o (P1,330,000 / P2,000,000) = 66.50%

Aggrega on of Segments:
• Segment 6 and 7 meet majority of the aggrega on criteria
Revenue of reportable segments before aggrega on P1,330,000
Revenue of aggregated segments 6 and 7 190,000
Total P1,520,000
External Revenue Ra o (P1,520,000 / P2,000,000) = 76%
Total Reportable Segments: Segments 1, 3, 4, 5 and Segments 6 and 7 aggregated as one
segment

8. B
Loss from typhoon P 700,000
Loss from inventory write-down 500,000
Payment of re insurance premium for the calendar year (100,000 / 4) 25,000
Total Expenses P1,225,000
9. A
Adver sing Expense P2,000,000
Bonuses (P20,000,000 / 4) 5,000,000
Expense for the 1st Quarter P7,000,000

10. B
Bad debt expense for the en re year P450,000
Bad debt expense recognized:
1ST quarter (2,000,000 x 5%) 100,000
2nd quarter (1,500,000 x 5%) 75,000
3rd quarter (2,500,000 x 5%) 125,000 300,000
Bad debt expense for the fourth quarter P150,000
11. C
Deprecia on expense (2/4 x P600,000) P300,000
Year end bonuses (2/4 x P1,200,000) 600,000
P900,000
12. D
Variable Expenses (4,000,000 x 25%) P1,000,000
Fixed expenses excluding adver sing and dep.
(P3,000,000 – P1,600,000 – P600,000) 800,000
Adver sing Expense (1,600,000 / 4) 400,000

ti
ti


ti

fi


ti

ti
ti

ti













ti

ti

ti

 Deprecia on (P600,000 / 4) 150,000

Total expenses to be reported in the rst quarter P2,350,000

13. B
P6,000,000 x 30% = P(1,800,000)

14. C
P 7,000,0 00 x 30% = P(2,100,000)

15. B
Cumula ve Income Tax (P21,000,000 X 25%) P5,250,000
Recognized Income Tax Expenses:
First Quarter (P6,000,000 X 30%) (1,800,000)
Second Quarter (P7,000,0 00 X 30%) (2,100,000)
Third Quarter Income Tax Expense P1,350,000

Test II. Theory

1. C 14.B
2. C 15.D
3. D 16.A
4. A 17.C
5. A 18. C
6. D 19.B
7.B 20.D
8.B 21.D
9.D 22.C
10.C 23.D
11.B 24.D
12.B 25.D
13.C

ti
ti

fi