Operating Segments and Reportable Segments Quiz

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What is an operating segment of an entity?

A component that only incurs expenses

A component that only earns revenues

A component that is reviewed by the entity's chief operating decision maker

A component that engages in business activities, earns revenues, incurs expenses, and is reviewed by the entity's chief operating decision maker (correct)

What is a reportable segment?

A segment that is not reviewed by the entity's chief operating decision maker

Operating segments or aggregations of operating segments (correct)

Only aggregations of operating segments

A segment that is not part of an entity

What should an entity explain about each reportable segment?

The measurement of the segment revenues

The measurement of the segment liabilities

The measurement of the segment profit or loss

The measurement of the segment profit or loss and segment liabilities (correct)

What should be reconciled for reportable segments?

All of these Signup and view all the answers

What information should be available for an operating segment?

Discrete financial information Signup and view all the answers

What is the primary objective of using a valuation technique?

To estimate the price at which an orderly transaction to sell the asset would take place under current market conditions Signup and view all the answers

Which of the following valuation techniques uses prices and other relevant information from market transactions involving identical or similar assets?

Market approach Signup and view all the answers

Which valuation technique requires the amount to replace the service capacity of an asset?

Cost approach Signup and view all the answers

Which valuation technique converts future amounts to a single current amount?

Income approach Signup and view all the answers

What is the purpose of the income approach in valuation techniques?

To convert future amounts to a single current amount Signup and view all the answers

What does the risk inherent in valuation techniques used to measure fair value refer to?

The uncertainty in determining the exact value of an asset Signup and view all the answers

What does a market quote price that differs depending on whether an asset is being sold or bought from the market indicate?

There is a discrepancy in the market Signup and view all the answers

What does the effect of P/L or other comprehensive income for a period of recurring fair value measurements imply?

The asset's value has fluctuated Signup and view all the answers

What does the acquisition date signify in a business combination?

The date on which the acquirer effectively obtains control of the acquiree Signup and view all the answers

What does positive goodwill represent in a business combination?

Excess of cost of combination over a share of net assets Signup and view all the answers

How is goodwill measured after its initial recognition?

At costless accumulated impairment losses Signup and view all the answers

When is goodwill tested for impairment?

When events or changes in circumstances indicate that it might be impaired Signup and view all the answers

Which standard deals with the Impairment of Assets?

IAS 36 Signup and view all the answers