In segment reporting, a segment is considered significant and should be disclosed in financial statements if it meets any of the following quantitative thresholds:
- *Revenue Test*: Segment revenue (including external and intersegment sales) is 10% or more of total revenue.
- *Profit or Loss Test*: Segment profit or loss is 10% or more of the greater of:
- Combined profit of all profitable segments
- Combined loss of all loss-making segments
- *Asset Test*: Segment assets are 10% or more of total assets.
First clip... Answer is D . Hampton Segments consider Bingham,Harvey,Norton,Randall
Why Harvey,Norton,Randall..on the basis of Revenue,they have >10% of total revenue
Why Bingham...bcoz as compared to others, Bingham earns 10%+ operating profit over sales,other segment less than 10%-
Second clip... Answer B
Martin segment reporting considered A,B,D,E as they have inter segment sales revenue, except C..on the basis of Revenue criteria
Conclusion..in each case,sales, inter segment sales, profit,loss,assets...sharing =>10,% is threshold.
very informattive
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