Asked by ethan battista on Jul 09, 2024
Verified
What is the main objective in disclosing segmented information?
A) It provides a broader view of the entire economic entity controlled by the parent.
B) It provides information to assess the risk of different operating units.
C) It increases the income of different operating segments.
D) It reduces the cost of financial reporting.
Segmented Information
Financial information that is broken down into segments, such as geographic regions, product lines, or business units, within a company's financial statements.
Operating Units
Divisions or branches within a larger enterprise, each handling operations semi-independently but under the governance of the enterprise.
- Analyze the importance of segmental information disclosure in assessing business risks and performance.
Verified Answer
KB
karina bravoJul 13, 2024
Final Answer :
B
Explanation :
The main objective in disclosing segmented information is to provide information to assess the risk of different operating units. This information helps investors and other stakeholders make informed decisions about the company's financial performance and future prospects. While segmented information may provide a broader view of the entire economic entity controlled by the parent, increasing income of operating segments or reducing the cost of financial reporting are not the main objectives.
Learning Objectives
- Analyze the importance of segmental information disclosure in assessing business risks and performance.
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