35 An intangible asset is considered impaired when its carrying value is greater than its recoverable amount. The recoverable amount is a. its historical cost b. its replacement cost c. its net selling price d. the greater of its net selling price or its value in use

35 An intangible asset is considered impaired when its carrying value is greater than its recoverable amount. The recoverable amount is a. its historical cost b. its replacement cost c. its net selling price d. the greater of its net selling price or its value in use

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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35
An intangible asset is considered impaired when its carrying value is greater than its recoverable amount. The recoverable amount is

a. its historical cost

b. its replacement cost

c. its net selling price

d. the greater of its net selling price or its value in use

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A loss on impairment on a limited life intangible asset is the difference between the asset’s Select one: carrying value and its undiscounted expected future net cash flows. fair value and its net realizable value. fair value and its discounted expected future net cash flows. carrying value and its fair value.
Impairment of an intangible asset occurs when the book value of an asset is less than the fair value. True O False
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The undiscounted future net cash flow is used as a benchmark to determine any impairment loss on which of the following types of intangible assets? O Limited life intangibles. O Indefinite life intangibles other than goodwill. O Goodwill. O Indefinite life intangibles.
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The carrying amount of an item of property, plant and equipment shall be derecognized 1. On disposal II. When no future economic benefits are expected from the use or disposal of the asset II only Neither I nor II Either I or II x I only
TRUE OR FALSE The term used to describe the mechanical process of allocating the cost of an intangible asset to expense over the shorter of the legal life or estimated useful life is called amortization.
in calculating an impairment loss, which TWO of the following are correct? Assets should be carried at the higher of their carrying amount and recoverable amount Recoverable amount is the higher of value in use and fair value less costs of disposal Recoverable amount is the lower of value in use and fair value less costs of disposal Assets should be carried at the lower of their carrying amount and recoverable amount
What is an impairment loss? A ) The amount by which the carrying amount of an asset exceeds the book value B ) The amount by which the carrying amount of an asset exceeds the recoverable amount C ) The difference between the fair value of an asset and the net realisable value of the asset D ) The amount by which the market value of an asset exceeds the net present value
please dont plagiarise otherwise i will report
MCQ4 Which of the following is not a characteristic of an intangible asset? It may be impaired and written off. It may be amortized using the straight-line method. Its useful life may exceed its legal life for amortization. O It has no physical substance.
The main objective of IAS 36 Impairment of Assets is to prescribe the procedures that should ensure that an entity's assets are included in its statement of financial position at no more than their recoverable amounts. Where an asset is carried at an amount in excess of its recoverable amount, it is said to be impaired and IAS 36 requires an impairment loss to be recognized. Required: Define an impairment loss explaining the relevance of fair value less costs to sell and value in use and state how frequently assets should be tested for impairment. 2. Describe the possible incators of impairment. 3. Explain how an impairment loss is accounted for after it has been calculated.