Dean Hardware, Inc. is comprised of five operating segments. Information about each of these segments is as follows (in thousands): 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?
A) $8.2.
B) $9.0
C) $10.4.
D) $13.0.
E) $82.0.

Question

Dean Hardware, Inc. is comprised of five operating segments. Information about each of these segments is as follows (in thousands):  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?
A) $8.2. 
B) $9.0 
C) $10.4. 
D) $13.0. 
E) $82.0.

Quizplus · Accepted Answer

Pails $82 + Shovels $12 + Hardware $34 + Acc. $2 = Total Profit $130 × 10% = $13 Threshold for Segment Profit/Loss