For Purposes of Goodwill Impairment Evaluation, Which of the Following

question 83

Multiple Choice

For purposes of goodwill impairment evaluation, which of the following is not a characteristic of an operating segment of a public entity as defined in the Codification?

• A) It engages in business activities from which it may earn revenues and incur expenses.
• B) The segment has produced net profits for at least three of the last five operating cycles.
• C) The entity's chief decision maker regularly reviews the performance of the segment.
• D) The segment's discrete financial information is available.

---

Definitions:

Common-sized Balance Sheet

A balance sheet where each line item is expressed as a percentage of total assets, facilitating comparison across companies and time periods.

Trend Balance Sheet

A financial statement that shows the changing balances of each account over a series of periods, helping in analyzing trends over time.

Comparative Balance Sheet

A financial statement that presents the assets, liabilities, and equity of a company at different points in time for comparison.

Vertical Analysis

An approach to analyzing financial statements where every item listed under the key account categories of assets, liabilities, and equity is shown as a percentage of the total figure for that category.