CA NO: 6

Presented below is an excerpt from the financial statements of\nH. J. Heinz Company.\nSegment and Geographic Data\nThe company is engaged principally in

Presented below is an excerpt from the financial statements of

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H. J. Heinz Company.

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Segment and Geographic Data

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The company is engaged principally in one line of business—processed food products—which represents over 90% of consolidated sales. Information about the business of the company by geographic area is presented in the table below.

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There were no material amounts of sales or transfers between geographic areas or between affi liates, and no material amounts of United States export sales.

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Foreign

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(in thousands of United Western

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U.S. dollars) Domestic Kingdom Canada Europe Other Total Worldwide

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Sales $2,381,054 $547,527 $216,726 $383,784 $209,354 $1,357,391 $3,738,445

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Operating income 246,780 61,282 34,146 29,146 25,111 149,685 396,465

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Identifi able assets 1,362,152 265,218 112,620 294,732 143,971 816,541 2,178,693

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Capital expenditures 72,712 12,262 13,790 8,253 4,368 38,673 111,385

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Depreciation expense 42,279 8,364 3,592 6,355 3,606 21,917 64,196

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Instructions

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(a) Why does H. J. Heinz not prepare segment information on its products or services?

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(b) What are export sales, and when should they be disclosed?

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(c) Why are sales by geographical area important to disclose?

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