Exam 11: Impairment of Assets

When goodwill is acquired under a business combination it is subject to an impairment test every:

Under IAS 36 Impairment of Assets, the impairment testing of goodwill occurs at the:

At reporting date, the carrying amount of a cash-generating unit was considered to be have been impaired by $800. The unit included the following assets: $\bullet$ Land $4000; $\bullet$ Plant $3000; $\bullet$ Goodwill $1000. The carrying amount of Goodwill after the impairment loss is allocated is:

When an asset is measured using the revaluation model, any impairment loss is treated as:

The carrying amount of a cash-generating unit was considered to be impaired. The impairment loss was €600. The cash-generating unit included the following assets: $\bullet$ Goodwill €1000; $\bullet$ Buildings €2000; $\bullet$ Plant and Equipment €1500. The carrying amount of Goodwill after allocation of the impairment loss is:

In relation to the impairment of assets, IAS 36 Impairment of Assets, requires the following disclosures for each class of assets: I The line of the statement of profit or loss and other comprehensive income in which impairment losses are included. II The amount of reversals of impairment losses during the period. III The amount of impairment losses recognised directly in other comprehensive income. IV The beginning and ending balances of any 'provision for impairment' account.

Candy Limited expected future cash flows from the use of Equipment as follows: $\bullet$ End of Year 1 £4000; $\bullet$ End of Year 2 £5000; $\bullet$ End of Year 3 £2000. The discount rate was determined as 5%. The value in use of the equipment is:

Constructor Limited estimated an impairment loss of €500 against its single cash-generating unit. The company had the following assets: $\bullet$ Headquarters Building €1000; $\bullet$ Construction Plant €600; $\bullet$ Equipment €400. The net carrying amount of the Equipment after allocation of the impairment loss is: