Reference no: EM132789521

Problem 1: Operating segments that do not meet any of the quantitative thresholds

a. Cannot be considered reportable.

b. May be considered reportable and separately disclosed if management believes that information about the segment would be useful to the users of the financial statements

c. May be considered reportable and separately disclosed if the information is for internal use only.

d. May be considered reportable and separately disclosed if this is the practice within the economic environment in which the entity operates.

Ariana Company and its divisions provided the following information for the current year:

Sales to unaffiliated customers 20,000,000

Intersegment sales of products similar to those sold to unaffiliated

customers 6,000,000

Interest earned on loans to other operating segments 400,000

Ariana Company and all of its divisions are engaged solely in manufacturing operations.

Problem 2: What is the minimum amount of segment revenue in order that a division can be considered a reportable segment?

a. 2,640,000

b. 2,600,000

c. 2,040,000

d. 2,000,000