One of the conditions used to determine if two or more operating segments may be aggregated into a single operating segment is:
A) the segments have the same manager in charge;
B) the aggregation is deemed to provide useful information for users;
C) the segments have similar operating results;
D) the segments have similar methods used to distribute their product or provide their services.

Question

Quizplus · Accepted Answer

The correct answer is D because operating segments can be aggregated if they have similar methods used to distribute their products or provide their services, according to accounting standards for segment reporting. This similarity in distribution or service provision methods indicates that the segments may exhibit similar long-term financial performance, making it reasonable to aggregate them for reporting purposes.

One of the Conditions Used to Determine If Two or More