Intersegment Sales

AAA

DEFINITION of 'Intersegment Sales'

The transfer or exchange of goods for monetary compensation from one department in a company to another department within the same company. Intersegment sales exists where a corporation has multiple segments or divisions, and product sales occur between these segments. A segment report containing data related to intersegment sales and transfers is typically included in a corporation's annual report.

INVESTOPEDIA EXPLAINS 'Intersegment Sales'

Segments are components of the same corporation or entity that provide products (or a group of products) that have different risks and returns than another segment. Intersegment sales can be manufacturing products, such as the sale or transfer of steel from one segment to another, or it can be a financial product, as with the banking and insurance industries. Accurate bookkeeping is important in order to correctly assign revenue and expenses related to the transfer or sales.

RELATED TERMS
  1. Segment Margin

    The amount of profit or loss produced by one component of a business. ...
  2. Consumer Goods

    Products that are purchased for consumption by the average consumer. ...
  3. Segment

    A component of a business that is or will generate revenues and ...
  4. Annual Report

    1. An annual publication that public corporations must provide ...
  5. Operating Income

    The amount of profit realized from a business's operations after ...
  6. After Tax Operating Income - ATOI

    A company's total operating income after taxes. This non-GAAP ...
Related Articles
  1. Active Trading

    The Importance Of Segment Data

    Key financials often fail to provide insight into large cap companies.
  2. Investing

    What is the difference between an industry and a sector?

    The terms industry and sector are often used interchangeably to describe a group of companies that operate in the same segment of the economy or share a similar business type. Although the terms ...
  3. Professionals

    Understanding Interpersonal Skills

    Interpersonal skills are the social skills people use to interact effectively with other people. A lack of good interpersonal skills may lead to unsuccessful personal relationships, as well as ...
  4. Fundamental Analysis

    What's a Tangible Asset?

    Tangible assets are property owned by a business that can be touched -- they physically exist. Examples include furniture and fixtures, computer hardware, delivery equipment, leasehold improvements ...
  5. Fundamental Analysis

    Cash Flow From Operating Activities

    Cash flow from operating activities is a section of the Statement of Cash Flows that is included in a company’s financial statements after the balance sheet and income statements.
  6. Fundamental Analysis

    What are the components of shareholders' equity?

    Understanding company valuation figures, such as shareholders' equity, can be a powerful tool in assessing the financial strength of a business.
  7. Fundamental Analysis

    What is the difference between the acid test ratio and working capital ratio?

    Using liquidity ratios to determine the financial stability of a company is an important tool to accounting professionals and investors.
  8. Fundamental Analysis

    What are some examples of return on investment capital?

    Read about some basic examples of return on investment capital for publicly traded companies and companies that have a handful of investors.
  9. Bonds & Fixed Income

    What is the difference between the yield of stock and the yield of a bond?

    Explore and understand the various meanings of the investment term "yield" as it is applied to equity investments and bond investments.
  10. Fundamental Analysis

    What is the difference between cash flow and EBIDTA?

    Understand the difference between cash flow and EBITDA, and find out why cash flow is a more comprehensive metric for evaluating a company's financial health.

You May Also Like

Hot Definitions
  1. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  2. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  3. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  4. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
  5. Fixed Asset

    A long-term tangible piece of property that a firm owns and uses in the production of its income and is not expected to be ...
  6. Break-Even Analysis

    An analysis to determine the point at which revenue received equals the costs associated with receiving the revenue. Break-even ...
Trading Center