A Company That Generates Reports by Both Geographic Region and Product

question 19

Multiple Choice

A company that generates reports by both geographic region and product line must consider additional criteria in identifying operating segments when there are multiple sets of reports.Which of the following statement(s) is correct? (I.) An operating segment has a segment manager who is directly accountable to the chief operating decision maker for its financial performance.
(II.) If more than one set of organizational units exists, each organizational unit is considered an operating segment even if there is only one set for which segment managers are held responsible.
(III.) If segment managers exist for two or more overlapping sets of organizational units, the nature of the business activities must be considered.

• A) I, II, and III.
• B) I and III only.
• C) I and II only.
• D) II and III only.
• E) None of the above.

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Definitions:

Liquidation

The process of closing a business, selling its assets, and using the proceeds to settle its debts, with any remaining funds distributed to owners or shareholders.

Distributions-in-Kind

Non-cash assets paid out to investors or partners from a firm or fund.

Partnership's Assets

Items of value owned by a partnership that are used or can be used to conduct its business.

Economic Viability

The ability of an entity, project, or activity to sustain its operations and make a profit over the long term.