Question: Question 4 12 Marks (a) When do you think an entity should conduct an impairment test for non-current assets? 3 Marks (b) Prince Chemical Ltd

Question 4 12 Marks (a) When do you think an entity

Question 4 12 Marks (a) When do you think an entity should conduct an impairment test for non-current assets? 3 Marks (b) Prince Chemical Ltd has determined that its cash-generating unit has assets with the following carrying amounts: Building Plant Showroom Goodwill $600,000+ $800,000+ $320,000 $240.000 $1,960,000 Prince Chemical Ltd measure the value in use of the cash-generating unit, which is calculated at its present value, amounted to $1,560,000. The current fair value less costs to sell of the entire unit is $1.400.000. Required: (1) Calculate the impairment loss 2 Marks (11) Allocate the impairment loss to each asset and their net carrying amounts after impairment. 4 Marks (111) Provide journal entries for the impairment loss. 3 Marks * [3+9 = 12 Marks]

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