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CA Intermediate · Advanced Accounting · AS 17 Segment Reporting

Himalaya Cements Ltd. (non-financial company) provides these details of the assets related to its Cement segment (₹ lakh): property, plant and equipment 400, inventories 120, trade receivables 80, cash balances used in segment operations 20, advance income tax paid 30, and long-term investments in shares of other companies 50. What are the segment assets under AS 17?

Segment assets are ₹620 lakh. They comprise property, plant and equipment, inventories, receivables and cash used in operations. Advance income tax is excluded because AS 17 leaves out income tax assets, and share investments are excluded because the segment is not primarily financial.

  1. A₹620 lakhCorrect
  2. B₹650 lakh
  3. C₹670 lakh
  4. D₹700 lakh

Explanation

Segment assets are operating assets employed in and directly attributable to the segment. Include PPE 400, inventories 120, receivables 80 and operating cash 20, giving 620. Income tax assets (advance tax) and investments of a non-financial segment are excluded. Including advance tax gives 650; including both gives 700.

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