At the end of 2020, Sheffield Corporation owns a licence with a remaining life of 10...

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At the end of 2020, Sheffield Corporation owns a licence with a remaining life of 10 years and a carrying amount of $514,000. Sheffield expects undiscounted future cash flows from this licence to total $518,600. The licence's fair value is $408,500 and disposal costs are estimated to be nil. The licence's discounted cash flows (that is, value in use) are estimated to be $463,500. Sheffield prepares financial statements in accordance with IFRS. QUESTION: Assume the recoverable amount is calculated to be $433,400 at the end of 2021. Determine if the licence is impaired at the end of 2021. The licence at the end of 2021. Prepare any related entry that is necessary. (Credit account titles are automatically Indented when the amount Is entered. Do not Indent manually. If no entry Is requlred, select "No Entry" for the account titles and enter o for the amounts.) Account TItles and Explanatlon Deblt Credit At the end of 2020, Sheffield Corporation owns a licence with a remaining life of 10 years and a carrying amount of $514,000. Sheffield expects undiscounted future cash flows from this licence to total $518,600. The licence's fair value is $408,500 and disposal costs are estimated to be nil. The licence's discounted cash flows (that is, value in use) are estimated to be $463,500. Sheffield prepares financial statements in accordance with IFRS. QUESTION: Assume the recoverable amount is calculated to be $433,400 at the end of 2021. Determine if the licence is impaired at the end of 2021. The licence at the end of 2021. Prepare any related entry that is necessary. (Credit account titles are automatically Indented when the amount Is entered. Do not Indent manually. If no entry Is requlred, select "No Entry" for the account titles and enter o for the amounts.) Account TItles and Explanatlon Deblt Credit

Answer rating: 100% (QA)

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