ABC is testing a store branch for impairment. The assets of the branch include a building with a carrying amount of P4,000,000, equipment of P3,000,000, inventory of P2,000,000 and goodwill of P500,000. The fair value less cost to dispose of the inventory is P2,500,000. The expected cashflows from the branch are: Year Amount 1 P 2,000,000 2 1,700,000 3 1,500,000 4 1,500,000 5 1,300,000 The effective interest rate is 9%. The present value of the cashflows beyond year 5 is estimated to be at P400,000. 10. Value in use of the store branch 11. Total Impairment Loss 12. Carrying value of the building after impairment 13. Carrying value of the inventory after impairment 14. Carrying value of the goodwill after impairment
ABC is testing a store branch for impairment. The assets of the
branch include a building with a carrying amount of P4,000,000,
equipment of P3,000,000, inventory of P2,000,000 and
P500,000.
The fair value less cost to dispose of the inventory is P2,500,000.
The expected cashflows from the branch are:
Year Amount
1 P 2,000,000
2 1,700,000
3 1,500,000
4 1,500,000
5 1,300,000
The effective interest rate is 9%. The present value of the cashflows
beyond year 5 is estimated to be at P400,000.
10. Value in use of the store branch
11. Total Impairment Loss
12. Carrying value of the building after impairment
13. Carrying value of the inventory after impairment
14. Carrying value of the goodwill after impairment
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