Question

Asset Group Impairment: The abrasives group of Chemical Products Incorporated (CPI) has been suffering a decline in its business, due to new product introductions by competitors. At 31 December 20X5, the assets of the abrasives cash- generating unit are shown as follows ( in millions) on the company’s balance sheet:


An impairment test indicates that the fair value of the abrasives cash- generating unit’s assets is $ 500 million. The assets are not separable— they must be operated or sold together as a group.

Required:
Prepare an adjusting journal entry to record theimpairment.


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  • CreatedFebruary 17, 2015
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