Operating Segments and Reportable Segments Quiz
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Questions and Answers

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?

    <p>All of these</p> Signup and view all the answers

    What information should be available for an operating segment?

    <p>Discrete financial information</p> Signup and view all the answers

    What is the primary objective of using a valuation technique?

    <p>To estimate the price at which an orderly transaction to sell the asset would take place under current market conditions</p> 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?

    <p>Market approach</p> Signup and view all the answers

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

    <p>Cost approach</p> Signup and view all the answers

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

    <p>Income approach</p> Signup and view all the answers

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

    <p>To convert future amounts to a single current amount</p> Signup and view all the answers

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

    <p>The uncertainty in determining the exact value of an asset</p> 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?

    <p>There is a discrepancy in the market</p> 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?

    <p>The asset's value has fluctuated</p> Signup and view all the answers

    What does the acquisition date signify in a business combination?

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

    What does positive goodwill represent in a business combination?

    <p>Excess of cost of combination over a share of net assets</p> Signup and view all the answers

    How is goodwill measured after its initial recognition?

    <p>At costless accumulated impairment losses</p> Signup and view all the answers

    When is goodwill tested for impairment?

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

    Which standard deals with the Impairment of Assets?

    <p>IAS 36</p> Signup and view all the answers

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