7. Which of the following is the best evidence of an asset's fairvalue less costs to sell?(a) An asset that is trading in an active market.(b) The price in a binding sale agreement.(c) Information available that determines the disposal value of theasset in an arm's length transaction.(d) The carrying value of the asset.8. When calculating the estimates of future cash flows, which ofthe following cash flows should notbe included?(a) Cash flows from disposal.(b) Income tax payments.(c) Cash flows from the sale of assets produced by the asset.(d) Cash outflows on the maintenance of the asset.9. When deciding on the discount rate that should be used, whichfactors should not be taken into account?(a) The time value of money.(b) Risks that relate to the asset for which future cash flowestimates have not been adjusted.(c) Risks specific to the asset for which futurecash flow estimates have been adjusted.(d) Pretax rates.10. An impairment loss that relates to an asset that has beenrevalued should be recognized in(a) Profit or loss.(b) Revaluation reserve that relates to the revalued asset.(c) Opening retained profits.(d) Any reserve in equity.11. A cash-generating unit is(a) The smallest business segment.(b) Any grouping of assets that generates cash flows.(c) Any group of assets that is reported separately to management.(d) The smallest group of assets that generates independent cashflows from continuing use.12. Goodwill should be tested for impairment(a) If there is an indication of impairment.(b) Annually.(c) Every five years.(d) On the acquisition of a subsidiary.13. Where part of the cash-generating unit is disposed of, thegoodwill associated with the elementdisposed of(a) Shall be written off to the income statement entirely.(b) Shall not be included in the calculation of gain or loss ondisposal.(c) Shall be included in the calculation of gain or loss on disposal(d) Shall be written off against retained profits. 14. When impairment testing a cash-generating unit, any corporateassets, such as the head office businessor computer equipment, should(a) Be allocated on a reasonable and consistent basis.(b) Be separately impairment tested.(c) Be included in the head office assets or parent's assets andimpairment tested along with that cash-generating unit.(d) Not be allocated to cash-generating units.15. When allocating an impairment loss, such a loss should reducethe carrying amount of which ass(a) Property, plant, and equipment.(b) Intangible assets.(c) Goodwill.(d) Current assets.first?16. Which of the following impairment losses should never bereversed?(a) Loss on property, plant, and equipment.(b) Loss on goodwill.(c) Loss on a business segment.(d) Loss on inventory.

Since you have asked multiple questions, we will solve the first question for you. If you want any…

Answered: 7. Which of the following is the best…

Business

Operations Management

7. Which of the following is the best evidence of an asset's fair value less costs to sell?

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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