Chapter 24: 16Q (page 1445)
What are interim reports? Why are balance sheets often not provided with interim data?
The reason behind the Balance Sheet is not given with interim data as the data is not considered to be significant for a short period.
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Interim reporting under IFRS:
(a) is prepared using the discrete approach.
(b) is prepared using a combination of the discrete and integral approach.
(c) requires a complete set of financial statements for each interim period.
(d) permits companies to omit disclosure of material events subsequent to the interim reporting date.
Identify the segment information that is required to be disclosed by GAAP.
Carlton Company is involved in four separate industries. The following information is available for each of the four industries.
| Operating Segment | Total Revenue | Operating Profit (Loss) | Identifiable Assets |
| W | \( 60,000 | 15,000 | \)167,000 |
| X | 10,000 | 3,000 | 83,000 |
| Y | 23,000 | (2,000) | 21,000 |
| Z | 9,000 | 1,000 | 19,000 |
| \(102,000 | \)17,000 | $290,000 |
Instructions
Determine which of the operating segments are reportable based on the:
c) Identifiable assets test.
In calculating inventory turnover, why is cost of goods sold used as the numerator? As the inventory turnover increases, what increasing risk does the business assume?
Presently, the profession requires that earnings per share be disclosed on the face of the income statement. What are some disadvantages of reporting ratios on the financial statements?
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