Multiple Choice
Rebound Inc.reports under IFRS.In 2016 Rebound recognized an impairment of $200,000 due to a troubled debt restructuring.In 2017 Rebound was pleased to determine that more cash flows would be received from the receivable than was previously thought,such that,if the total impairment were to be calculated in 2017,it would be estimated as $150,000 rather than $200,000.How should Rebound treat this in its 2017 income statement?
A) Rebound should ignore the change,given that recovery of its previous impairments is not allowed under IFRS.
B) Rebound should make a prior period adjustment of 2016 income,given that the impairment charge was in error.
C) Rebound should recognize an increase in 2017 net income of $50,000.
D) None of these answer choices are correct.
Correct Answer:
Verified
Correct Answer:
Verified
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