According to IAS 36 Impairment of Assets, the recoverable amount test requires an entity to compare the fair value an asset less costs to sell, with: O a. O b. C. O d. the amount obtainable from the sale of the asset its value in use. its disposal value the costs directly attributable to the liquidation of the asset
Q: DATE 1 April 5 April 10 April 15 April 20 April 25 April 30 April TOTAL AMOUNT 12.000,00 5.000,00…
A: INVENTORY VALUATIONInventory Valuation is a Method of Calculation of Value of Inventory at the End…
Q: Cost of Goods Sold Bob's Bistro produces party-sized hoagie sandwiches. For next year, Bob's Bistro…
A: The cost of goods manufactured includes the cost of goods that are finished during the period. The…
Q: the December 31 adjusted trial balance and other records of Leone Company. Advertising expense $…
A: Cost of goods manufactured:— It is the total cost of completed finished goods transferred from work…
Q: MWANJOMBE Limited entered into a four year lease on 1 January 2022 for a machine. Rentals are TZS…
A: Income statement:An income statement stands for the statement that shows profits and loss of the…
Q: What was the change in net working capital during the year? Note: Enter your answer in thousands of…
A: Net Working Capital shows a company’s net difference between its current assets and current…
Q: 2. Change all of the numbers in the data area of your worksheet so that it looks like this: 1…
A: It is the process of making decisions that involve the management of costs in order to achieve…
Q: following estimates: Machine - hours required to support estimated production 160, 000 Fixed…
A: The pre-determined overhead rate is calculated as the estimated overhead costs divided by the…
Q: 5 Karla Tanner opened a Web consulting business called Linkworks and completed the following…
A: Journal entries are made to record the transactions as the first process in the books of accounts…
Q: Gooran, Inc., has current assets of $160 million; property, plant, and equipment of $380 million;…
A: Assets = Current assets + Property, plant & equipment + Other assets Liabilities = Current…
Q: Assume the following: • The standard price per pound is $2.00. •. The standard quantity of pounds…
A: Material variance is the difference between standard material cost for actual production and actual…
Q: b. How would your answer change if McKenzie decided to use additional first-year (bonus)…
A: Bonus depreciation (cost recovery) is different from section 179 expense. Unlike section 179, there…
Q: Brant Consulting designs costing and transfer pricing system for its clients. Here is a summary of…
A: The breakeven point is a term used to describe the volume of sales or revenue at which a company…
Q: Hull Company's record of transactions concerning part X for the month of April was as follows.…
A: FIFO - It is a method of inventory valuation in which goods received first is issued first.LIFO - It…
Q: For the two independent cases that follow, determine the missing amount for each letter. (Hint: You…
A: Assets are the resources owned by the entity. These may be current or non-current. Some of the…
Q: P9-1 (Algo) Recording and Reporting Current Liabilities LO9-1 Vigeland Company completed the…
A: Journal Entry :— It is an act of recording transaction in books of account when transaction…
Q: Required information Use the following information for the Quick Study below. (Algo) [The following…
A: The term cash flow from operating activities (CFO) represents the amount of money that a firm makes…
Q: Randy Corp. issued $200,000 of 7.6% (payable each 28 February and 31 August). 4-year bonds. The…
A: The term "proceeds of bonds" refers to the funds raised by issuing bonds. When a government,…
Q: Depreciation is a process that involves: a. Increasing the value of assets b. Distributing the cost…
A: Expense is the amount of money incurred by the entity to run the daily operations of the business.…
Q: The objectivity standards of management accountants state that they must communicate information…
A: The management accountants are the accountants which are having the role in the business in those…
Q: Use the following information for Exercise 2-9 through Exercise 2-12 below. (Static) [The following…
A: 1. Accounting Equation -Accounting Equation is calculated using following equation -Assets =…
Q: The adjusting entry to account for estimated customer returns and allowances involves a a. credit to…
A: Sales returns means goods being returned by customer. Sales allowances means reductions are being…
Q: Required Information [The following Information applies to the questions displayed below] Pumpworks…
A: Consolidation in accounting is the process of combining the financial statements of a parent company…
Q: The following data relate to factory overhead cost for the production of 5,000 computers: Variable…
A: Variance arises when the actual costs differ from the standard costs. The results are favorable…
Q: Brant Consulting designs costing and transfer pricing system for its clients. Here is a summary of…
A: The breakeven point is a term used to describe the volume of sales or revenue at which a company…
Q: Slayer Corp. hired Dave Lombardo to investigate some unusual accounts receivable transactions.…
A: There are different types of fraud done by employees to steal from the workplace. Most of these…
Q: Using the following information, calculate the operating profit margin ratio for the Sleepy Z Ranch…
A: The operating profit margin is calculated by subtracting the cost of goods sold and selling, general…
Q: Assume a company is considering buying 10,000 units of a component part rather than making them. A…
A: Make or Buy is the decision making analysis that helps the entity to decide if the goods should be…
Q: Paloma Company has four employees. FICA Social Security taxes are 6.2% of the first $137,700 paid to…
A: FICA stands for Federal Insurance Contributions Act. It is a U.S. payroll tax.These taxes are social…
Q: The following information is available regarding Grace Smit's capital account in Enterprise…
A: Partnership is an agreement where two or more persons agreed to share profits or loss and to manage…
Q: s when the bonds were issue to the market. These will be amortized ing amortized on a straight-line…
A: Loss of redemption is the difference between carrying or book value of bond and redemption value.…
Q: 7. Which of the following is a current asset? A. Insurance paid in advance Accrued salary B. C.…
A: “Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: . L. Dearborn owns a department store that has a $45,000 balance in Accounts Receivable and a $3,000…
A: The allowance for doubtful accounts is created to record the estimated bad debt expense for the…
Q: The following information was extracted from the accounting records of Roosevelt Manufacturing…
A: Cost of goods manufactured:— It is the total cost of completed finished goods transferred from work…
Q: Answer the following questions. Hint. Use the accounting equation. a. At the beginning of the year,…
A: Equity shareholders are the owners of the companies that hold shares or stocks. It helps investors…
Q: Georgia Manufacturing Company provides the following ABC costing information: Activities…
A: Under activity-based costing method, the cost is allocated to each activity based on its…
Q: Lucas Industries uses departmental overhead rates to allocate its manufacturing overhead to jobs.…
A: Total cost is the amount of cost incurred on the making of the goods. It include the cost of direct…
Q: ume the following facts relating to an 80% owned subsidiary company: BOY Stockholders’ Equity…
A: Consolidation -The financial accounts of several entities presented as belonging to a single…
Q: Identify the fraud triangle risk factor (Opportunity, Pressure, or Rationalization) in each…
A: Case 1: The business has no cameras or security devices at its warehouse.The most appropriate factor…
Q: December 1 December 2 December 3 Sanyu Sony transferred $65,000 cash from a personal sav name of…
A: Financial statements include an income statement, a statement of owner's equity and a balance…
Q: At the start of the year, Vencor Company estimated manufacturing overhead to be $2,000,000. Eighty…
A: Estimated savings in overhead cost:Variable overhead rate = $4 per machine hourExplanation: First,…
Q: The badges of trade are used for which of the following purposes? A To determine whether an…
A: The objective of the question is to understand the purpose of the 'badges of trade' in the context…
Q: consequences of conducting business as a C corporation and the annual income tax savings. Please…
A: Write meaning of cash method and Accrual Method.
Q: 1. Mountain High Ice Cream Company transferred $74,000 of accounts receivable to the Prudential…
A: Account Receivable -Short-term money owed to a business is represented by the asset item on the…
Q: Connor Ltd. is a large private company owned by the Connor family. It operates a manufacturing…
A: The common-size financial statement refers to the financial statement in which every line is…
Q: Norton Textile Co. manufactures a variety of fabrics. All materials are introduced at the beginning…
A: WEIGHTED AVERAGE METHOD:— Under this method, equivalent units are calculated by adding equivalent…
Q: ! < EX 1-4 Accounting Equation Procter & Gamble Assets $115,095 Liabilities 67,516 Determine the…
A: The objective of the question is to calculate the stockholders' equity for Procter & Gamble and…
Q: Prepare a classified balance sheet in good form as of December 31, 2022. (List Current Assets in…
A: This Statement shows the balance of assets liabilities and Equity as at the balance sheet date.…
Q: in predicts the following sales in units for the coming four months: April May June July 360 400 420…
A: Lets understand the basics.Management prepares budget in order to estimate future profit and loss…
Q: On April 22, 2023, Carla Vista Enterprises purchased equipment for $137.720. The company expects to…
A: Depreciation is the reduction in the value of asset due to normal wear and tear and passage of…
Q: Snyder Company is considering purchasing equipment. The equipment will produce the following cash…
A: A financial tool called present value enables investors, companies, and individuals to determine the…
3
Step by step
Solved in 3 steps
- 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.Under IAS 36 Impairment of Assets, impairment test for an individual asset requires that the carrying amount of the asset be compared to its recoverable amount. According to IAS 36, ‘recoverable amount’ is defined as the higher of two items. Which one of the following correctly describes these two items? a. present value of future cash flows from the asset and fair value of asset less costs of disposal b. future cash flows from the asset and fair value of asset less costs of disposal c. future cash flows from the asset and fair value of asset d. present value of future cash flows from the asset and fair value of the assetThe following terms are mismatched with its definitions. Match the terms to its correct definitions. Terms Definitions Carrying amount The higher of an asset's fair value less costs to sell and its value in use Cost The cost of an asset or other amount substituted for cost, less its residual value Depreciable amount The amount by which the carrying amount of an asset exceeds its recoverable amount Entity-specific value The amount at which an asset is recognised after deducting any accumulated depreciation and accumulated impairment losses Fair value The amount of cash or cash equivalents paid or the fair value of other consideration given to acquire an asset at the time of its acquisition or construction Recoverable amount The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date Residual value The present value of the cash flows an entity expects to arise from the…
- If an entity was not able to determine the fair value of both the asset received and the asset given up, which is used in measuring the cost of the asset received? Group of answer choices fair value of the asset given up. fair value of the asset received. either fair value of the asset given up or carrying value of the asset given up carrying value of the asset given upThe sale of a depreciable asset resulting in a loss indicates that the proceeds from the sale are a. Lesser than cost b. Less than current fair value c. Lesser than carrying amount d. Greater than carrying amount e. Greater than costWhich statement is correct regarding derecognition of financial assets? A. Transfer of risks and rewards is evaluated by determining the transferee’s ability to sell the asset. B. A sale and repurchase transaction where the repurchase price is a fixed price is a transfer of financial asset that qualifies for derecognition. C. The entity shall continue to recognize the transferred asset in its entirety if the transfer does not qualify for derecognition because the entity has retained substantially all the risks and rewards of ownership of the transferred asset. D. If an entity neither transfers nor retains substantially all the risks and rewards of ownership of a transferred asset, the entity shall continue to recognize the transferred asset to the extent of its continuing involvement.
- Which among the sentences below is incorrect? An entity shall measure a current asset or disposal group classified as held for sale at the lower of carrying (A amount or fair value less cost of disposal. An entity can recognize a gain if there is a subsequent increase in fair value less cost of disposal but only up (B to the impairment loss previously recognized. (C Impairment loss is the writedown to fair value less cost of disposal. One of the conditions that exists if the sale is highly probable is that there is an active program to locate a D buyer and complete the plan must have been initiated.1. The sale of a depreciable asset resulting in a loss indicates that the proceeds from the sale are a) Lesser than carrying amount b) Less than current fair value c) Lesser than cost d) Greater than carrying amount e) Greater than cost1. On derecognition of a financial asset , the difference between the consideration received and the carrying amount of the financial asset shall be: 2 points a. Recognized in other comprehensive income for financial asset at amortized cost and profit or loss for financial asset at fair value. b. Recognized in profit or loss only for financial asset measured at amortized cost. c. Recognized in profit or loss only for financial asset measured at fair value. d. Recognized in profit or loss for both financial asset at fair value and financial asset at amortized cost. 2. The entity purchased government bonds. The entity’s business model in managing financial assets is to collect contractual cash flows that are solely payments of principal and interest on the principal amount outstanding. Which of the following is the most appropriate classification for the investment in bonds? 2 points a. At fair value through profit or loss. b. At amortized cost.…
- 1. On derecognition of a financial asset , the difference between the consideration received and the carrying amount of the financial asset shall be: 2 points a. Recognized in other comprehensive income for financial asset at amortized cost and profit or loss for financial asset at fair value. b. Recognized in profit or loss only for financial asset measured at amortized cost. c. Recognized in profit or loss only for financial asset measured at fair value. d. Recognized in profit or loss for both financial asset at fair value and financial asset at amortized cost. 2. The entity purchased government bonds. The entity’s business model in managing financial assets is to collect contractual cash flows that are solely payments of principal and interest on the principal amount outstanding. Which of the following is the most appropriate classification for the investment in bonds? 2 points a. At fair value through profit or loss. b. At amortized cost.…Which among the sentences below is incorrect?A. An entity shall measure a current asset or disposal group classified as held for sale at the lower of carrying amount or fair value less cost of disposal.B. One of the conditions that exists if the sale is highly probable is that there is an active program to locate a buyer and complete the plan must have been initiated.C. Impairment loss is the writedown to fair value less cost of disposal.D. An entity can recognize a gain if there is a subsequent increase in fair value less cost of disposal but only up to the impairment loss previously recognized.Under IFRS, an intangible asset is considered to be impaired if it carrying value is greater than its recoverable amount. The recoverable amount is Its net selling price The greater of its net selling price or its value in use Its historical cost The lesser of its net selling price or its value in use
