To understand current generally accepted accounting principles with respect to accounting for and reporting on the operating segments of a company, as stated in FASB Statement No. 131, it is necessary to be familiar with certain terminology. Furthermore, central issues in reporting on operating segments of a company are the determination of which segments are reportable, and what is to be reported.

Required
1. Explain what is meant by an operating segment of a company.
2. What are the tests to determine whether or not an operating segment is reportable?
3. Briefly identify the information that a company must disclose in regard to its reportable operating segments.