An operating segment is a component of a company
A) that engages in business activities to earn revenues and incur expenses.
B) whose operating results are regularly reviewed by the company's chief operating officer for budgeting and evaluation purposes.
C) for which financial information is available.
D) All of these types of companies would have an operating segment as a component.

Question

Quizplus · Accepted Answer

An operating segment meets all these criteria: it engages in business activities generating revenues and incurring expenses, its operating results are reviewed by the entity's chief decision maker (often the chief operating officer) for decision-making purposes, and there is available financial information for the segment.

An Operating Segment Is a Component of a Company