The following are the details from the incomestatements of division S and division C for the yearending March 2014. Figures in '000 Tshs– Sales revenue100,000120,000- Operating cost- Interest cost64,00075,000|6,00010,000- Capital invested– Capital invested include debt- WACC- Rate of corporate tax- Required;- Calculate NOPAT as adjusted for EVA and also calculate EVAfor both the divisions. Which Division performed better.122,000150,00010%12.5%40%44%-

Let Sales = S Operating cost = O Tax rate = T WACC = r Capital invested = C

The following are the details from the income statements of division S and division C for the year ending March 2014. Figures in '000 Tshs - Sales revenue 100,000 120,000 - Operating cost - Interest cost - Capital invested - Capital invested include debt - WACC - Rate of corporate tax - Required; - Calculate NOPAT as adjusted for EVA and also calculate EVA for both the divisions. Which Division performed better. 64,000 75,000 | 6,000 10,000 - 122,000 150,000 - - 10% 12.5% - 40% 44% - -

The following are the details from the income statements of division S and division C for the year ending March 2014. Figures in '000 Tshs - Sales revenue 100,000 120,000 - Operating cost - Interest cost - Capital invested - Capital invested include debt - WACC - Rate of corporate tax - Required; - Calculate NOPAT as adjusted for EVA and also calculate EVA for both the divisions. Which Division performed better. 64,000 75,000 | 6,000 10,000 - 122,000 150,000 - - 10% 12.5% - 40% 44% - -

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter14: Decentralized Operations

Section: Chapter Questions

Problem 14.2E: Divisional income statements The following data were summarized from the accounting records for...

See similar textbooks

Similar questions

The following results are available for Division X and Y:Division X Division YProfit before interest and tax P185 000 P172, 000Capital employed P1, 540, 000 P1, 650, 000The cost of capital is 10%.Calculate and comment on the performance of the departments based on:a. Return on capital employed (4 marks)b. Residual incom
The following are available for divison X and Y Profit before interest and tax X 185 000 Y172 000 Capital employed X 1 540 000 Y 1 650 000 The cost of capital is 10% comment on the performance of the departments based on a. Return on capital employed b.residual income
In the income statement for the current year, the entity which is subject to the requirements of segment report, reported external sales of P60,000,000, internal sales of P5,000,000, expenses of P45,000,000. The combined total assets of all operating segments at year-end amounted to P56,000,000. What is the lowest amount of external revenue that should be disclosed by reportable segments?
The following are the details from the income statements of division S and division C for the year ending March 2014. Figures in TZS "000" Sales revenue 100,000 64,000 6,000 120,000 75,000 10,000 150,000 Operating cost Interest cost Capital invested 122,000 Capital invested include debt WACC 10% 12.5% Rate of corporate tax 40% 44% Required: Calculate NOPAT as adjusted for EVA and also calculate EVA for both the divisions. Which Division performed better?
) Cecil Inc. operates with three divisions: Naperville, Metropolitan and Urbana. Below areselected results for each division over the last two fiscal years.a. Calculate Return on Assets (ROA) for Cecil Inc. in 2021 and 2020 (report percentages rounded twodecimals).b. Calculate Return on Sales (ROS) for Cecil Inc. in 2021 and 2020 (report percentages rounded twodecimals).c. Industry Averages are 15% for ROA and 10% for ROS in 2021 and 2020. Discuss Cecil Inc.’sperformance trends and results compared to industry averages (discuss performance, do not repeatcalc’s from above).Revenues: 2021 2020 Naperville 22,500,000 19,600,000 Metropolitan 15,300,000 12,500,000 Urbana 9,500,000 8,700,000Operating Income: Naperville 1,900,000 1,800,000 Metropolitan 1,100,000 900,000 Urbana 1,100,000 1,050,000Average Total Assets: Naperville 10,000,000 9,500,000 Metropolitan 8,000,000 6,500,000 Urbana 4,500,000 4,300,000Number of Managers: Naperville 15 5 Metropolitan 9 10 Urbana 12
Divisional income statements The following data were summarized from the accounting records for Vintage Construction Company for the year ended October 31, 20Y3. Prepare divisional income statements for Vintage Construction Company.
An entity identified the following segment for the current year: Segment Revenue Profit Assets A 10,000,000 1,750,000 20,000,000 B 8,000,000 1,400,000 17,500,000 C 6,000,000 1,200,000 12,500,000 D 3,000,000 550,000 7,500,000 E 4,000,000 575,000 5,500,000 F 2,000,000 525,000 3,000,000 What are the reportable segments? a. SEGMENT A, B and C b. SEGMENT A, B, C and D c. SEGMENT A, B, C, D and E d. SEGMENT A, B, C, D, E and F
PDT Co. has two divisions, East and West. Invested assets and condensed income statement data for each division for the past year ended December 31 are as follows: East Division West Division Revenues $1,200,000 $800,000 Operating expenses 950,000 640,000 Service department charges 145,000 72,000 Invested assets 800,000 500,000 (a) Prepare condensed income statements for the past year for each division. (b) Using the expanded expression, determine the profit margin, investment turnover, and rate of return on investment for each division. Round to one decimal place.
Snow Company’s revenue for the year ended December 31, 2020 was as follows:Consolidated revenue per statement ofcomprehensive income $1,200,000Inter-segment sales 240,000Combined revenue of all segments $1,440,000Snow has a reportable operating segment if that segment’s revenue exceeds ____________________.A. $ 6,000B. $ 24,000C. $120,000D. $144,000
Colorway Inc. had total assets of P65,000,000 at year end and provided the following condensed income statement for the current year: Sales 45,000,000 Expenses (33,000,000) Income before income tax 12,000,000 Income tax expense (3,800,000) Net Income 8,200,000 The entity has two reportable segments and has developed the following related information: Segment A Segment B Others Sales 25,000,000 15,000,000 5,000,000 Segment expenses 18,000,000 9,000,000 4,000,000 Segment assets 35,000,000 18,000,000 7,000,000 The total assets of P65,000,000 include general corporate assets of P5,000,000. The total segment expenses of P33,000,000 include general corporate expenses of P2,000,000. The chief operating decision maker does not allocate income tax as a measure of profit or loss. Required: 1 Prepare the necessary disclosures for Colorway Inc. in relation to operating segments. 2 Prepare the reconciliations between segment information and amount shown in the entity's financial statements.
Presented below are the condensed income statement of Vital Corporation for the years ended December 31, 2020 and 2019: 2020 5,000,000 3.350,000 1,650,000 675,000 975,000 200,000 1,175,000 411,250 763.750 2019 4,900,000 3,300,000 1,600,000 650,000 950,000 Sales Cost of goods sold Gross income Operating expenses Operating income Gain on sale of division 950,000 332,500 617.500 Net income before income tax Income tax expense (35%) Net income On October 10, 2020, Chalangs entered into an agreement to sell the assets of one of its geographical segments. The geographical segment comprises operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the company. The segment was sold on December 31, 2020, for P1,750,000. The book value of the segment's assets was P1,550,000. The segment's contribution to Chalangs' operating income before tax for each year was as follows: 2020 113,750 loss 81,250 income 2019 Assume that by…
Selected data for a segment of a business enterprise are to be reported separately when the revenue ofthe segment exceeds 10% of the ____________________________________________________.A. Combined net income of all segments reporting profitsB. Total revenue obtained in transactions with outsidersC. Total revenue of all the enterprise’s segmentsD. Total combined revenue of all segments reporting profits