INTERMEDIATE ACCOUNTING ACCESS 540 DAY
10th Edition
ISBN: 9781264706327
Author: SPICELAND
Publisher: MCG
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Chapter 11, Problem 11.21BE
To determine
Impairment of
To determine: The amount of impairment loss of goodwill.
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Q21
Which of the following is NOT a step in impairment testing?
Select one:
a. Sell the asset after if the fair value is greater than the recoverable amount
b. Calculate the asset’s carrying amount in the books of the entity
c. Calculate the recoverable amount of the asset
d. Assess whether there are circumstances that may indicate that the asset should be impaired.
Q10
Which of the following statement is NOT correct?
Select one:
a. When the carrying amount of an asset is less than the recoverable amount, then an asset should have its previous impairments reversed to the value of the recoverable amount provided there is accumulated amortization to cover the difference.
b. The difference between the carrying amount of an asset and the recoverable is the impairment loss if the carrying amount is greater.
c. When the carrying amount of an asset is greater than the recoverable amount, then an asset should be impaired to the value of the recoverable amount
d. The difference between the carrying amount of an asset and the recoverable is the impairment loss if the carrying amount is less.
Q23
Which of the following statement(s) is (are) true?
(i) An intangible asset is impaired if the carrying amount is higher than its recoverable amount
(ii) Recoverable amount is the asset’s fair value or its value-in-use at the reporting date.
(iii) For an intangible asset with infinite useful life, impairment test should be performed only if there is evidence to indicate that an intangible asset has been impaired.
(iv) For an intangible asset with finite useful life, impairment test should be performed annually even if there is no evidence that the asset has been impaired.
Select one:
a. (i), (ii), (iii) and (iv)
b. (i) and (ii) only
c. (i) and (iv) only
d. (i) only
Chapter 11 Solutions
INTERMEDIATE ACCOUNTING ACCESS 540 DAY
Ch. 11 - Prob. 11.1QCh. 11 - Depreciation is a process of cost allocation, not...Ch. 11 - Identify and define the three characteristics of...Ch. 11 - Discuss the factors that influence the estimation...Ch. 11 - What is meant by depreciable base? How is it...Ch. 11 - Prob. 11.6QCh. 11 - Prob. 11.7QCh. 11 - Why are time-based depreciation methods used more...Ch. 11 - Prob. 11.9QCh. 11 - Prob. 11.10Q
Ch. 11 - Briefly explain the differences and similarities...Ch. 11 - Prob. 11.12QCh. 11 - Prob. 11.13QCh. 11 - What are some of the simplifying conventions a...Ch. 11 - Explain the accounting treatment required when a...Ch. 11 - Explain the accounting treatment and disclosures...Ch. 11 - Explain the steps required to correct an error in...Ch. 11 - Prob. 11.18QCh. 11 - Prob. 11.19QCh. 11 - Prob. 11.20QCh. 11 - Prob. 11.21QCh. 11 - Briefly explain the differences between U.S. GAAP...Ch. 11 - Under U.S. GAAP, litigation costs to successfully...Ch. 11 - Cost allocation At the beginning of its fiscal...Ch. 11 - Prob. 11.4BECh. 11 - Prob. 11.5BECh. 11 - Prob. 11.8BECh. 11 - Prob. 11.10BECh. 11 - Prob. 11.11BECh. 11 - Prob. 11.12BECh. 11 - Prob. 11.13BECh. 11 - Impairment; property, plant, and equipment LO118...Ch. 11 - Prob. 11.18BECh. 11 - IFRS; impairment; property, plant, and equipment ...Ch. 11 - Prob. 11.20BECh. 11 - Prob. 11.21BECh. 11 - IFRS; impairment; goodwill LO1110 IFRS Refer to...Ch. 11 - Subsequent expenditures LO119 Demmert...Ch. 11 - Prob. 11.1ECh. 11 - Prob. 11.2ECh. 11 - Prob. 11.3ECh. 11 - Prob. 11.4ECh. 11 - Depreciation methods; solving for unknowns LO112...Ch. 11 - Prob. 11.10ECh. 11 - Prob. 11.12ECh. 11 - Prob. 11.13ECh. 11 - Prob. 11.15ECh. 11 - Prob. 11.16ECh. 11 - Prob. 11.26ECh. 11 - Impairment; property, plant, and equipment LO118...Ch. 11 - IFRS; impairment; property, plant, and equipment ...Ch. 11 - Prob. 11.30ECh. 11 - Prob. 11.31ECh. 11 - Prob. 11.32ECh. 11 - Prob. 11.33ECh. 11 - FASB codification research LO118 The FASB...Ch. 11 - Prob. 11.35ECh. 11 - Subsequent expenditures LO119 Belltone Company...Ch. 11 - Concept s; terminology LO111 through LO116, LO118...Ch. 11 - Depreciation methods; change in methods LO112,...Ch. 11 - Prob. 11.6PCh. 11 - Prob. 11.7PCh. 11 - Prob. 11.10PCh. 11 - Prob. 11.12PCh. 11 - Prob. 11.14PCh. 11 - Analysis Case 111 Depreciation, depletion, and...Ch. 11 - Communication Case 112 Depreciation LO111 At a...Ch. 11 - Judgment Case 113 Straight-line method; composite...Ch. 11 - Prob. 11.4DMPCh. 11 - Prob. 11.8DMPCh. 11 - Research Case 119 FASB codification; locate and...Ch. 11 - Prob. 11.11DMPCh. 11 - Real World Case 1115 Depreciation and depletion...Ch. 11 - Prob. 11.16DMPCh. 11 - Target Case LO112, LO118, LO119 Target...
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- q24 Which of the following is NOT a step in impairment testing? Select one: a. Calculate the asset’s carrying amount in the books of the entity b. Sell the asset after if the fair value is greater than the recoverable amount c. Calculate the recoverable amount of the asset d. Assess whether there are circumstances that may indicate that the asset should be impaired.arrow_forward43 If the “fair value less cost to sell” of a noncurrent asset held for sale is lower than its carrying value, the difference is treated as a. gain b. impairment loss c. depreciation expense d. prior period adjustmentarrow_forwardq19 Which statement is INCORRECT regarding recognition of intangible assets? Select one: a. An intangible asset should be initially recorded at cost. b. An intangible asset acquired in exchange of another asset can be recognized at the fair value of the asset given up in exchange. c. An intangible asset can only be recognized if its cost can be measured reliably. d. An intangible asset can be recorded at its fair value if its cost cannot be ascertained.arrow_forward
- 12. Which of the following statements about the requirements of IFRS 5 is incorrect? a. At the end of the reporting period, when the fair value less costs to sell decreases from the initial recognition of the asset as held for sale, an impairment loss shall be recognized in profit or loss. b. At the end of die reporting period, when the fair value less costs to sell decreases from the initial recognition of the asset as held for sale, an impairment loss shall be recognized in other comprehensive income. c. An entity shall recognize gain from subsequent increase in fair value less cost to sell of an asset O held for sale, but not in excess of the cumulative unrecovered impairment loss recognized for that asset. d. An entity may reclassify an asset held for sale to an asset held for use when management changes its plan for the sale and decides to use the asset for operations.arrow_forward23 Which statements are correct concerning goodwillI. goodwill shall not be amortized because its useful life is indefiniteII. goodwill shall be tested for impairment at least annually or more frequently if events or changes in circumstances indicate a possible impairment.III. Once impairment loss is recognized for goodwill, the loss taken up is not allowed to be reversed in a subsequent period.IV. Further costs of developing and maintaining goodwill should be capitalized. a. I, II and III b. I,III and IV c. I,II and IV d. II,III and IVarrow_forward7. T or F: If an impairment loss is recognized under the US. GAAP later recovery of the loss is prohibitedarrow_forward
- 20. For an SME, changes in the fair value less costs to sell of biological assets are a. recognized in profit or loss b. recognized in other comprehensive income c. not recognized d. a or barrow_forwardYour asset is impaired: its 'fair value less costs to sell' is OMR 4k and its value in use' is OMR 6k. Carrying value of the asset is OMR 8k. Which is the value of asset in the statement of financial position after impairment? O a. OMR 8k. O b. Loss of OMR 2k. O c. Zero. O d. OMR 6k.arrow_forward18 Fair value less cost to sell: P650,000 Value in use:P750,000 Carrying amount:P1,010,000 Compute the impairment loss Group of answer choices P160,000 P100,000 P260,000 P360,000arrow_forward
- Sh18arrow_forward3arrow_forward93 Conptal Framo PROBLEMS PROBLEM 1: TRUE OR FALSE All changes in an entity's economic resources and claims to those resources result from the entity's financial performance. The qualitative characteristics of useful information apply nly to the financial information provided in the financial statements. . According to IFRS Practice Statement 2 Making Materiality Judgnents, cost is an important consideration when making materiality judgments. T, When making materiality judgments, assessment alone is not always sufficient to conclude that an item of information is not material. Es. Materiality judgments apply only to items that are recognized but not to those that are unrecognized. 6. The more significant the qualitative factors are, the lower the quantitative thresholds will be. Thus, an item with a zero amount can be material in light of qualitative thresholds. Fz. When making materiality judgments, an entity should judge an item's materiality only on its own and not in combination…arrow_forward
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