Farr, Inc Is a Multidivisional Corporation Which Has Both Intersegment Sales

question 5

Multiple Choice

Farr, Inc. is a multidivisional corporation which has both intersegment sales and sales to unaffiliated customers. Farr should report segment financial information for each division meeting which of the following criteria?

• A) Segment profit or loss is 10% or more of consolidated profit or loss.
• B) Segment profit or loss is 10% or more of combined profit or loss of all company segments.
• C) Segment revenue is 10% or more of combined revenue of all the company segments.
• D) Segment revenue is 10% or more of consolidated revenue.

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Definitions:

Wholesalers

Businesses that buy goods in large quantities from manufacturers and then resell them in smaller quantities to retailers or other businesses.

Personalized Services

Customized offerings tailored to meet the individual preferences and needs of customers, often using data insights.

Profit Margins

The difference between the selling price and the cost of goods sold, expressed as a percentage of the selling price, indicating the profitability of a product or business.

Blockchain

A decentralized, distributed ledger technology that records transactions across many computers in such a way that the registered transactions cannot be altered retroactively.