Question: Define a cash generating unit. Why must a discontinued operation be a cash- generating unit?

Define a cash generating unit. Why must a discontinued operation be a cash- generating unit?

Step by Step Solution

★★★★★

3.44 Rating (151 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

A cashgenerating unit is a group of assets that generates cash flows that are largely indep... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Document Format (1 attachment)

Word file Icon

396-B-A-I-S (1264).docx

120 KBs Word File

Students Have Also Explored These Related Accounting Questions!

Q:

Define required cash and surplus cash. Why does it matter how we treat surplus cash for valuation purposes?

Q:

Define net operating cash flows. Briefly explain why periodic net operating cash flows may not be a good indicator of future operating cash flows.

Q:

Define reasonable assurance. Why must auditors provide reasonable (rather than absolute) assurance?

Q:

Roasters Plc has determined that its organic coffee division is a cash-generating unit (CGU). The carrying amounts of the assets at 31 March 2021 are as follows: Factory 210.000 Land 150,000...

Q:

I. Multiple Choice - Theories (PFRS 5: Noncurrent Asset Held for Sale and Discontinued Operations) 1. It is group of assets to be disposed by sale or otherwise, together as a group in a single...

Q:

I. Multiple Choice - Theories (PFRS 5: Noncurrent Asset Held for Sale and Discontinued Operations) 1. It is group of assets to be disposed by sale or otherwise, together as a group in a single...

Q:

a . ) Kutemwa Ltd acquired 1 0 0 % of a subsidiary, Zambezi Ltd , on 1 January 2 0 2 1 . The carrying amount of the assets of Zambezi Ltd in the consolidated financial statements of the Kutemwa Ltd...

Q:

1. How should the assets and liabilities of a disposal group classified as held for sale be shown in the statement of financial position? The assets and liabilities shall be offset and presented as a...

Q:

Bakewall Ltd prepares annual financial statements to 31 December. On 1 August 2017 the company closed down one of its operations and classified the corresponding cash generating unit (CGU) as held...

Q:

Bakewall Ltd prepares annual financial statements to 31 December. On 1 August 2019 the company closed down one of its operations and classified the corresponding cash generating unit (CGU) as held...

Q:

Define financial leverage and the degree of financial leverage (DFL). How are the two related?

Q:

Internal auditing is a staff function found in virtually every large corporation. The internal audit function is also performed in many smaller companies as a part-time activity of individuals who...

Q:

i did a java lab for random compliments and the feedback i got was in the main method i called two input methods when i was only allowed to call one, and then it was cited again later in the code...

Q:

Critics of ever-expanding college enrollments argue that many stu- dents should not be going to college. Rather, they should be going to trade or vocational schools. That way, they could become...

Q:

Prepare the following adjusting entries at December 31 for DeGads Co. (a) Interest on notes payable of $400 is accrued. (b) Fees earned but unbilled total $1,400. (c) Salaries earned by employees of...

Q:

At the end of its first year of operations, the trial balance of Rafael Company shows Equipment $30,000 and zero balances in Accumulated Depreciation Equipment and Depreciation Expense. Depreciation...

Q:

At the end of its first year of operations, the trial balance of Rafael Company shows Equipment $30,000 and zero balances in Accumulated Depreciation Equipment and Depreciation Expense. Depreciation...

Q:

Green Pastures golf sahas nmzdeki sezon iin planlama yapyor. Yatrmclar, irketin 40 milyon dolarlk varlndan %12 getiri elde etmek istiyor. irket ncelikle imleri ve im sahalar tmar etmek iin sabit...

Q:

After an inspirational course in Business Law several classmates establish in June 2011 the income tax accounting firm of "Luke, Matt, Ross" (L.M.R. General Partnership). Luke, Matt and Ross are all...

Q:

Number 13 In a science fairproject, Emily conducted an experiment in which she tested professional touch therapists to see if they could sense her energy field. She flipped a coin to select either...