If an Operating Segment Does Not Meet All of the Thresholds

question 12

Multiple Choice

If an operating segment does not meet all of the thresholds of significance, it:

• A) may not be designated as a reportable segment;
• B) may still be designated as a reportable segment;
• C) must be combined with the largest of the other segments and reported in aggregate;
• D) is insignificant and cannot be reported separately.

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Definitions:

Perpetual Inventory System

A method used by businesses to keep a real-time record of inventory levels, constantly updating with every sale and purchase.

Merchandise Inventory

Goods that a company holds for the purpose of selling them to customers.

Perpetual Inventory System

A method of inventory management where updates to inventory levels are made in real-time following every sale or purchase.

Merchandise Inventory

Goods that a retail merchandising business holds for sale to customers.