Which of the Following Statements Is True

question 20

Multiple Choice

Which of the following statements is true?

• A) In determining reportable segments, two tests are applied and both must be met.
• B) In determining reportable segments, three tests are applied and all three must be met.
• C) In determining reportable segments, two tests are applied and only one must be met.
• D) In determining reportable segments, three tests are applied and only one must be met.
• E) In determining reportable segments, at least 80% of the revenues from external customers must be reported.

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Definitions:

Gross Increases

Refers to the total increment in volume or quantity before any deductions like taxes or expenses are applied.

Business Activities

Various actions undertaken by a company as part of its operation, including investing, financing, and operating activities.

Revenues

The income received by a business from its normal business operations, often from the sale of goods or services.

Transposition

An error in which the order of the digits is changed, such as writing $542 as $452 or $524.