Hearts Company has various cash generating units. One cash generating unit has the following carrying amount of assets at year-end: Cash 600,000 1,400,000 Inventory Land 2,500,000 Plant and equipment Accumulated depreciation Goodwill 9,000,000 1,500,000 1,000,000 The management determined the value in use of the cash generating unit at P8,500,000. The fair value less cost of disposal for the inventory was greater than the carrying amount.
Hearts Company has various cash generating units. One cash generating unit has the following carrying amount of assets at year-end: Cash 600,000 1,400,000 Inventory Land 2,500,000 Plant and equipment Accumulated depreciation Goodwill 9,000,000 1,500,000 1,000,000 The management determined the value in use of the cash generating unit at P8,500,000. The fair value less cost of disposal for the inventory was greater than the carrying amount.
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter7: Fixed Assets, Natural Resources, And Intangible Assets
Section: Chapter Questions
Problem 7.3.3MBA
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1. Determine the amount of impairment loss.
2. What is the carrying value of Land after the recognition of the impairment loss?
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