At December 31, 2020, the assets of Mandarin Company's cash-generating unit (CGU) that include goodwill are...

 

Transcribed Image Text:

At December 31, 2020, the assets of Mandarin Company's cash-generating unit (CGU) that include goodwill are shown below (in millions) on the company's statement of financial position: ($ in millions) Cost Goodwill Equipment Building Patent rights Total Accumulated Net Book Depreciation value $200 $ 0 $200 1,500 900 600 1,500 800 700 200 100 100 $3,400 $1,800 $1,600 An impairment test indicates that the fair value less costs to sell of the CGU's assets is $1,100 million and its value in use is $1,000 million. The assets are not separablethey must be operated or sold together as a group. Assume that Mandarin Company uses IFRS. Required: a. Determine the amount of impairment loss (if any). Round the amounts to the nearest million $. (2 marks) Amount of Impairment Loss:_ b. Adjusting entry required to record impairment loss of CGU (if any). Round the amounts to the nearest million $. (4 marks) Debit Credit At December 31, 2020, the assets of Mandarin Company's cash-generating unit (CGU) that include goodwill are shown below (in millions) on the company's statement of financial position: ($ in millions) Cost Goodwill Equipment Building Patent rights Total Accumulated Net Book Depreciation value $200 $ 0 $200 1,500 900 600 1,500 800 700 200 100 100 $3,400 $1,800 $1,600 An impairment test indicates that the fair value less costs to sell of the CGU's assets is $1,100 million and its value in use is $1,000 million. The assets are not separablethey must be operated or sold together as a group. Assume that Mandarin Company uses IFRS. Required: a. Determine the amount of impairment loss (if any). Round the amounts to the nearest million $. (2 marks) Amount of Impairment Loss:_ b. Adjusting entry required to record impairment loss of CGU (if any). Round the amounts to the nearest million $. (4 marks) Debit Credit

Answer rating: 100% (QA)

Mandarin Company Impairment Loss of CGU a Impairment Loss Step 1 Higher Value We need to compare the ... View the full answer