Question 1

How might management be able to conceal segment information under the 'management approach' to identifying reportable segments?

Accepted Answer

Concealing segment information under the management approach:
- The management approach identifies segments on the basis of internal organisational structures and lines of management reporting.
- However,management could tailor the internal reports based on the management approach to conceal financial information if the internal reports are used as the basis for external segment information.

Question 2

What are the two characteristics of reliable information?

Accepted Answer

A)  Representational faithfulness and verifiability 
B)  Timeliness and representational faithfulness 
C)  Verifiability and relevance 
D)  Representational faithfulness and relevance 
A)  Representational faithfulness and verifiability 
B)  Timeliness and representational faithfulness 
C)  Verifiability and relevance 
D)  Representational faithfulness and relevance A

Question 3

The major argument against supplying segment information is that it provides users with potentially competitively damaging information.

Accepted Answer

A) True 
 B)False  True

Question 4

Information in relation to the amount of impairment losses and reversal of impairment losses for operating segments is required under Accounting Standard AASB 136 Impairment of Assets.

Accepted Answer

A) True 
 B)False

Question 5

An immaterial segment is never disclosed despite the 75% rule.

Accepted Answer

A) True 
 B)False

Question 6

For purposes of the reliance on a major customer,entities under common control are
considered as a single customer,

Accepted Answer

A) True 
 B)False

Question 7

Discuss the issues involved in allocating revenues,profits and assets to segments.

Accepted Answer

Issues involved in allocation of revenue

Question 8

Based on the business segments determined to be reportable segments for reporting to the board of directors each month,the following data have been derived from the notes attached to the subsidiary financial statements (amounts in thousands): $\begin{array}{lrrrr}\text { segment }&\text { Other }&\text { Sales }&\text { Result }&\text { Assets }\
&\text { Revenue }&\text { Revenue }\
\text { Piebalds } & \$ 30000 & \$ 5000 & \$ 2000 & \$ 30000 \
\text { Skewbalds } & 10000 & 15000 & 4000 & 10000 \
\text { Pintos } & 20000 & 5000 & (500) & 15000\\text { Crillos } & 15000 & 5000 & 3000 & 7000 \
\text { Other } & 5000 & - & 1000 & 10000\\text { Total }&\$80,000&\$30,000&\$9,500&\$72,000
\end{array}$ 
-On the basis of revenue,asset and results,the reportable business segments are:

Accepted Answer

A)  Piebalds, Pintos and Crillos. 
B)  Piebalds, Skewbalds, Pintos and Crillos. 
C)  Piebalds, Skewbalds, Pintos, Crillos and Others. 
D)  none of the above. 
A)  Piebalds, Pintos and Crillos. 
B)  Piebalds, Skewbalds, Pintos and Crillos. 
C)  Piebalds, Skewbalds, Pintos, Crillos and Others. 
D)  none of the above.

Question 9

A segment which does not reach any of the materiality thresholds can nevertheless be:

Accepted Answer

A)  designated as a reportable segment. 
B)  combined with other segments. 
C)  not reported separately. 
D)  all of the above. 
A)  designated as a reportable segment. 
B)  combined with other segments. 
C)  not reported separately. 
D)  all of the above.

Question 10

As part of the consolidation process,any unrealised profits arising from intragroup merchandising transactions are eliminated.If the intragroup transactions are inter-segment transactions,the effect of this elimination on the segment data reported by subsidiaries will be to:

Accepted Answer

A)  reduce the relevant segment result reported by the subsidiary. 
B)  have no effect on the segment result reported by the subsidiary. 
C)  reduce both the segment result reported by the subsidiary and reduce the consolidated profit of the group. 
D)  none of the above. 
A)  reduce the relevant segment result reported by the subsidiary. 
B)  have no effect on the segment result reported by the subsidiary. 
C)  reduce both the segment result reported by the subsidiary and reduce the consolidated profit of the group. 
D)  none of the above.

Question 11

Which of the following is NOT considered a basis for allocating joint selling and marketing expenses?

Accepted Answer

A)  Number of products 
B)  Sales revenue of services 
C)  Air time for each product 
D)  Square footage of manufacturing space for each product 
A)  Number of products 
B)  Sales revenue of services 
C)  Air time for each product 
D)  Square footage of manufacturing space for each product

Question 12

Based on the business segments determined to be reportable segments for reporting to the board of directors each month,the following data have been derived from the notes attached to the subsidiary financial statements (amounts in thousands): $\begin{array}{lrrrr}\text { segment }&\text { Other }&\text { Sales }&\text { Result }&\text { Assets }\
&\text { Revenue }&\text { Revenue }\
\text { Piebalds } & \$ 30000 & \$ 5000 & \$ 2000 & \$ 30000 \
\text { Skewbalds } & 10000 & 15000 & 4000 & 10000 \
\text { Pintos } & 20000 & 5000 & (500) & 15000\\text { Crillos } & 15000 & 5000 & 3000 & 7000 \
\text { Other } & 5000 & - & 1000 & 10000\\text { Total }&\$80,000&\$30,000&\$9,500&\$72,000
\end{array}$
- On revenue and asset criteria only,the reportable business segments are:

Accepted Answer

A)  Piebalds, Pintos and Crillos. 
B)  Piebalds, Skewbalds, Pintos and Crillos. 
C)  Piebalds, Skewbalds, Pintos, Crillos and Others. 
D)  none of the above. 
A)  Piebalds, Pintos and Crillos. 
B)  Piebalds, Skewbalds, Pintos and Crillos. 
C)  Piebalds, Skewbalds, Pintos, Crillos and Others. 
D)  none of the above.

Question 13

Segment information must be disclosed:

Accepted Answer

A)  on the face of the financial statements. 
B)  in a note to the financial statements. 
C)  either A or B. 
D)  none of the above. 
A)  on the face of the financial statements. 
B)  in a note to the financial statements. 
C)  either A or B. 
D)  none of the above.

Question 14

In reporting segment information,an entity must provide a reconciliation of:

Accepted Answer

A)  reportable segment sales revenue to total revenue. 
B)  reportable segment profit or loss before tax to total profit or loss before tax. 
C)  reportable segment assets and liabilities to total assets and liabilities. 
D)  all of the above. 
A)  reportable segment sales revenue to total revenue. 
B)  reportable segment profit or loss before tax to total profit or loss before tax. 
C)  reportable segment assets and liabilities to total assets and liabilities. 
D)  all of the above.

Question 15

Based on the business segments determined to be reportable segments for reporting to the board of directors each month,the following data have been derived from the notes attached to the subsidiary financial statements (amounts in thousands): $\begin{array}{lrrrr}\text { segment }&\text { Other }&\text { Sales }&\text { Result }&\text { Assets }\
&\text { Revenue }&\text { Revenue }\
\text { Piebalds } & \$ 30000 & \$ 5000 & \$ 2000 & \$ 30000 \
\text { Skewbalds } & 10000 & 15000 & 4000 & 10000 \
\text { Pintos } & 20000 & 5000 & (500) & 15000\\text { Crillos } & 15000 & 5000 & 3000 & 7000 \
\text { Other } & 5000 & - & 1000 & 10000\\text { Total }&\$80,000&\$30,000&\$9,500&\$72,000
\end{array}$
- On revenue and results only,the reportable business segments are:

Accepted Answer

A)  Piebalds, Pintos and Crillos. 
B)  Piebalds, Skewbalds, Pintos and Crillos. 
C)  Piebalds, Skewbalds, Pintos, Crillos and Others. 
D)  none of the above. 
A)  Piebalds, Pintos and Crillos. 
B)  Piebalds, Skewbalds, Pintos and Crillos. 
C)  Piebalds, Skewbalds, Pintos, Crillos and Others. 
D)  none of the above.

Question 16

Disclosure of segment information includes which of the following categories?

Accepted Answer

A)  General information 
B)  Information about profit or loss 
C)  Information about assets and liabilities 
D)  All of the above 
A)  General information 
B)  Information about profit or loss 
C)  Information about assets and liabilities 
D)  All of the above

Question 17

Operating segments may only be combined if they have similar economic characteristics.

Accepted Answer

A) True 
 B)False

Question 18

The management approach to identifying segments will result in consistency between internal and external reporting of segment information.

Accepted Answer

A) True 
 B)False

Question 19

The major argument for the disclosure in segment information concerns financial
statement presentation.

Accepted Answer

A) True 
 B)False

Question 20

In the reporting of segment revenue data:

Accepted Answer

A)  intra-segment revenue is eliminated as part of the consolidation process so that only sales revenue derived from sales to external customers is reported. 
B)  an entity must disclose the segment revenue for each reportable segment, although total intra-segment revenue may be disclosed as a lump sum for all segments. 
C)  an entity must disclose the segment revenue for each segment, with revenue from external customers and intra-segment revenue reported separately. 
D)  none of the above. 
A)  intra-segment revenue is eliminated as part of the consolidation process so that only sales revenue derived from sales to external customers is reported. 
B)  an entity must disclose the segment revenue for each reportable segment, although total intra-segment revenue may be disclosed as a lump sum for all segments. 
C)  an entity must disclose the segment revenue for each segment, with revenue from external customers and intra-segment revenue reported separately. 
D)  none of the above.

How might management be able to conceal segment information under the 'management approach' to identifying reportable segments?

What are the two characteristics of reliable information?

The major argument against supplying segment information is that it provides users with potentially competitively damaging information.

Information in relation to the amount of impairment losses and reversal of impairment losses for operating segments is required under Accounting Standard AASB 136 Impairment of Assets.

An immaterial segment is never disclosed despite the 75% rule.

For purposes of the reliance on a major customer,entities under common control are considered as a single customer,

Discuss the issues involved in allocating revenues,profits and assets to segments.

A segment which does not reach any of the materiality thresholds can nevertheless be:

As part of the consolidation process,any unrealised profits arising from intragroup merchandising transactions are eliminated.If the intragroup transactions are inter-segment transactions,the effect of this elimination on the segment data reported by subsidiaries will be to:

Which of the following is NOT considered a basis for allocating joint selling and marketing expenses?

Segment information must be disclosed:

In reporting segment information,an entity must provide a reconciliation of:

Disclosure of segment information includes which of the following categories?

Operating segments may only be combined if they have similar economic characteristics.

The management approach to identifying segments will result in consistency between internal and external reporting of segment information.

The major argument for the disclosure in segment information concerns financial statement presentation.

In the reporting of segment revenue data:

Text Objectives and Introduction to Consolidation

Principles of Consolidation

Fair Value Adjustments and Tax Effects

Intra-Group Transactions

Non-Controlling Interest

Partly-Owned Subsidiaries: Indirect Non-Controlling Interest

Consolidated Cash Flow Statements

Accounting for Joint Arrangements

Accounting for Associates and Joint Ventures: the Equity Method

Translation and Consolidation of Foreign Currency Financial Statements

Filters

Exam 11: Segment Reporting by Diversified Entities

How might management be able to conceal segment information under the 'management approach' to identifying reportable segments?

What are the two characteristics of reliable information?

The major argument against supplying segment information is that it provides users with potentially competitively damaging information.

Information in relation to the amount of impairment losses and reversal of impairment losses for operating segments is required under Accounting Standard AASB 136 Impairment of Assets.

An immaterial segment is never disclosed despite the 75% rule.

For purposes of the reliance on a major customer,entities under common control are considered as a single customer,

Discuss the issues involved in allocating revenues,profits and assets to segments.

A segment which does not reach any of the materiality thresholds can nevertheless be:

As part of the consolidation process,any unrealised profits arising from intragroup merchandising transactions are eliminated.If the intragroup transactions are inter-segment transactions,the effect of this elimination on the segment data reported by subsidiaries will be to:

Which of the following is NOT considered a basis for allocating joint selling and marketing expenses?

Segment information must be disclosed:

In reporting segment information,an entity must provide a reconciliation of:

Disclosure of segment information includes which of the following categories?

Operating segments may only be combined if they have similar economic characteristics.

The management approach to identifying segments will result in consistency between internal and external reporting of segment information.

The major argument for the disclosure in segment information concerns financial statement presentation.

In the reporting of segment revenue data:

Text Objectives and Introduction to Consolidation

Principles of Consolidation

Fair Value Adjustments and Tax Effects

Intra-Group Transactions

Non-Controlling Interest

Partly-Owned Subsidiaries: Indirect Non-Controlling Interest

Consolidated Cash Flow Statements

Accounting for Joint Arrangements

Accounting for Associates and Joint Ventures: the Equity Method

Translation and Consolidation of Foreign Currency Financial Statements

Filters