Lion Lyle Co. is a public company and reports operating segment information. The following information is available for the current reporting year: Sales to Operating ExternalIntersegment Sales lo Segment Revenues Customers $ 70,000 $ 30,000 $100,000 Monk 22,000 4,000 26,000 Nevi 8,000 16,000 24,000 Combined $100,000 $ 50,000 150,000 Elimination (50,000) (50,000) Consolidated $100,000 $100,000 Which operating segment (s) should be reportable segments?

1. None

2. Lion only

3. Lion and Monk only

4. Lion, Monk and Nevi

The operating segment that should be reportable segments are Lion, Monk and Nevi. The right answier is 4

Explanation:

In order to know which operating segment should be reportable segments we need to make the following calculations for each segment:

Lion = 100000/150000% = 67%

Monk = 26000/150000%=17%

Nevi = 24000/150000%=16%

The Segment will be reporting segement if combined income is more than 10% of total combined revenue.

Becasue all are above 10% that mean that all will be reportable segments.

Therefore, The operating segment that should be reportable segments are Lion, Monk and Nevi