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. Annual Report

    1. An annual publication that public corporations must provide ...
  4. After Tax Operating Income - ATOI

    A company's total operating income after taxes. This non-GAAP ...
  5. Operating Income

    The amount of profit realized from a business's operations after ...
  6. Segment

    A component of a business that is or will generate revenues and ...
Related Articles
  1. The Importance Of Segment Data
    Active Trading

    The Importance Of Segment Data

  2. What is the difference between an industry ...
    Investing

    What is the difference between an industry ...

  3. What are Business Ethics?
    Investing

    What are Business Ethics?

  4. What is Globalization?
    Investing

    What is Globalization?

Hot Definitions
  1. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  2. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  3. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  4. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
  5. Parity Price

    When the price of an asset is directly linked to another price. Examples of parity price are: 1. Convertibles - the price ...
  6. Earnings Multiplier

    An adjustment made to a company's P/E ratio that takes into account current interest rates. The earnings multiplier is used ...
Trading Center