a. What is meant by impairment? b. Given three examples of indications of impairment. c. When...

 

Transcribed Image Text:

a. What is meant by impairment? b. Given three examples of indications of impairment. c. When an impairment is made, how does this effect the income statement and the statement of financial position? d. Based on the information provided below, determine whether or not the following assets should be impaired. For the asset(s) that should be impaired, calculate the impairment loss. Asset 1 Asset 2 Accumulated impairment loss Cost to sell asset Value in use Fair value Acquisition cost Accumulated depreciation Cost of on-going maintenance of asset 300 25 125 650 1000 600 1250 650 1500 50 150 150 a. What is meant by impairment? b. Given three examples of indications of impairment. c. When an impairment is made, how does this effect the income statement and the statement of financial position? d. Based on the information provided below, determine whether or not the following assets should be impaired. For the asset(s) that should be impaired, calculate the impairment loss. Asset 1 Asset 2 Accumulated impairment loss Cost to sell asset Value in use Fair value Acquisition cost Accumulated depreciation Cost of on-going maintenance of asset 300 25 125 650 1000 600 1250 650 1500 50 150 150

Answer rating: 100% (QA)

Introduction The core principle in IAS 36 is that an asset must not be carried in the financial stat... View the full answer