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CA Intermediate · Advanced Accounting · AS 17 Segment Reporting

Kaveri Enterprises has these segment results (₹ lakh): Segment P profit 120, Q profit 60, R profit 20, S loss (30), T loss (12). Applying the segment result test of AS 17 (10% of the greater of combined profit of profit-making segments or combined loss of loss-making segments, in absolute terms), how many segments are reportable on this test alone?

Four segments are reportable. The benchmark is 10% of the greater of combined profits (₹200 lakh) or combined losses (₹42 lakh), giving ₹20 lakh. P, Q, R (exactly 10%) and S (loss of ₹30 lakh in absolute terms) meet it; T with a ₹12 lakh loss does not.

  1. A3
  2. B4Correct
  3. C5
  4. D2

Explanation

Combined profit is 120+60+20 = ₹200 lakh and combined loss is 42, so the greater is 200 and 10% is ₹20 lakh. P (120), Q (60), R (20, exactly 10%) and S (30 absolute) qualify. T at 12 does not. Answer 3 wrongly excludes R, as the standard says 10% or more.

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