Slatter Corporation operates primarily in the United States. However, a few years ago, it opened a plant in Spain to produce merchandise to sell there. This foreign operation has been so successful that during the past 24 months the company started a manufacturing plant in Italy and another in Greece. Financial information for each of these facilities follows:
|
Spain |
Italy |
Greece |
|
|
Sales |
$395,000 |
$272,000 |
$463,000 |
|
Intersegment transfers |
–0– |
–0– |
62,000 |
|
Operating expenses |
172,000 |
206,000 |
190,000 |
|
Interest expense |
16,000 |
29,000 |
19,000 |
|
Income taxes |
67,000 |
19,000 |
34,000 |
|
Long lived assets |
191,000 |
106,000 |
72,000 |
The company’s domestic (U.S.) operations reported the following information for the current year:
|
Sales to unaffiliated customers |
$4,610,000 |
|
Intersegment transfers |
427,000 |
|
Operating expenses |
2,410,000 |
|
Interest expense |
136,000 |
|
Income taxes |
819,000 |
|
Long lived assets |
1,894,000 |
Slatter has adopted the following criteria for determining the materiality of an individual foreign country: (1) sales to unaffiliated customers within a country are 10 percent or more of consolidated sales or (2) long lived assets within a country are 10 percent or more of consolidated long lived assets. Apply Slatter’s materiality tests to identify the countries to report separately.