Faulk Ltd.has provided the following information:

Under the revenue test only,which segments are reportable?
A)Segments A and C only
B)Segments B and D only
C)Segments B,C,and D only
D)All the segments are reportable.

Question

Faulk Ltd.has provided the following information:

Under the revenue test only,which segments are reportable?
A)Segments A and C only 
B)Segments B and D only 
C)Segments B,C,and D only 
D)All the segments are reportable.

Quizplus · Accepted Answer

Since we are only considering the revenue test, we need to identify segments that meet the 10% threshold of the combined revenues of all segments.

Segment A has a revenue of $10 million, which is less than 10% of the combined revenues ($100 million), and thus not reportable.

Segment B has a revenue of $40 million, which exceeds the 10% threshold and thus reportable.

Segment C has a revenue of $30 million, which exceeds the 10% threshold and thus reportable.

Segment D has a revenue of $20 million, which exceeds the 10% threshold and thus reportable.

Therefore, the reportable segments are B, C, and D, making choice C the correct answer.

Faulk Ltd.has Provided the Following Information