What amount should be reported as impairment loss on December 31, 2019? What is the carrying amount of the machinery on December 31, 2020? What amount should be recorded as gain on reversal of impairment on December 31, 2021?
On December 31, 2019, an entity has a machinery with the following cost and
Machinery 60,000,000
Accumulated depreciation 20,000,000
Carrying amount 40,000,000
The fair value of the machinery is determined to be 33,000,000 and the estimated cost of disposal of the machinery is 500,000. The future net
2020: 14,000,000
2021: 11,000,000
2022: 10,000,000
2023: 4,000,000
The discounted rate for the net cash flows is 10%. On December 31, 2021, the recoverable amount of the
machinery is determined to be 20,500,000 indicating reversal of impairment loss.
What amount should be reported as impairment loss on December 31, 2019?
What is the carrying amount of the machinery on December 31, 2020?
What amount should be recorded as gain on reversal of impairment on December 31, 2021?
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