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An asset has the following values:
If the asset was sold for its fair value, selling costs of $1,500 would be incurred.
Which of the following is the value of the impairment loss to be recognised for this asset in accordance with IAS 36 Impairment of Assets?
Suggested Answer: C
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33 comments · newest first
JU
Juan
11 months ago
Isn't the fair value minus selling costs the way to go?
HU
Hubert
11 months ago
Wait, how can it be $1,200? That seems off.
SH
Shawnna
11 months ago
Totally agree with you, Kristian!
KR
Kristian
12 months ago
I think the impairment loss is $1,200.
RO
Ronny
12 months ago
The selling costs are $1,500.
BU
Buddy
1 year ago
I feel like the answer might be $1,200, but I’m not completely confident. I need to double-check how selling costs impact the calculation.
TA
Tamar
1 year ago
I think the impairment loss is the difference between the carrying amount and the recoverable amount, but I can't recall the exact numbers we used in practice.
AL
Alpha
1 year ago
This question seems similar to one we practiced where we had to determine the recoverable amount. I think we need to subtract selling costs from fair value.
CH
Chandra
1 year ago
I remember we discussed how to calculate impairment losses, but I'm a bit unsure about how to factor in the selling costs here.
HA
Hassie
1 year ago
I'm a bit confused by this question. Can someone walk me through the step-by-step process of how to calculate the impairment loss? I want to make sure I understand it fully.
CA
Carman
1 year ago
Okay, let's see. The asset's fair value is $8,500, and selling costs are $1,500. I think I can figure this out, but I'll need to double-check my work.
AL
Alishia
1 year ago
Hmm, this looks like a tricky one. I'll need to carefully review the information provided and the requirements of IAS 36 to determine the correct impairment loss.
KE
Kelvin
1 year ago
This seems straightforward. The impairment loss is the difference between the asset's carrying amount and its fair value less selling costs, which is $2,000. I'm confident I can get this right.
HO
Hoa
2 years ago
I bet the exam creator thought they were being sly with this one, but we're too smart for their tricks! $1,200 is the impairment loss, no question about it. Time to move on to the next question and show off our accounting prowess!
DA
Dannette
2 years ago
Let's ace this exam with our accounting knowledge!
LA
Larae
2 years ago
Definitely, the selling costs of $1,500 would be deducted from the fair value of the asset.
AD
Adell
2 years ago
I agree, $1,200 is the correct impairment loss.
VE
Venita
2 years ago
Hmm, let me think about this. The fair value less selling costs is $500, and the carrying value is $1,700. Yep, option C is the correct answer - $1,200 is the impairment loss. Nailed it!
EM
Emily
2 years ago
I'm going with option C. $1,200 is the way to go, no doubt about it. How else would you calculate the impairment loss under IAS 36? This is a piece of cake!
MA
Marge
2 years ago
Yes, it's clear that the impairment loss for this asset should be $1,200. Option C is the answer.
AL
Alease
2 years ago
I agree, $1,200 seems to be the right choice based on the information provided.
AR
Art
2 years ago
I think option C is correct too. It's the impairment loss value according to IAS 36.
JO
Joseph
2 years ago
Wow, this is a tricky one. The fair value less selling costs is $2,000 - $1,500 = $500, and the carrying value is $1,700, so the impairment loss is $1,200. Easy peasy!
SH
Shaun
2 years ago
That makes sense, the correct answer is C) $1,200.
GR
Gregg
2 years ago
So, the impairment loss to be recognized is $1,200 according to IAS 36 Impairment of Assets.
FR
Francoise
2 years ago
I agree, the fair value less selling costs is $500, and the carrying value is $1,700.
BE
Beckie
2 years ago
I think the impairment loss is $1,200.
MA
Madelyn
2 years ago
But the selling costs are $1,500, so the impairment loss should be $1,200 (fair value - selling costs).
SH
Sherita
2 years ago
I believe it should be $300.
BU
Buffy
2 years ago
The impairment loss is clearly $1,200 according to IAS 36. That's the difference between the asset's carrying value and its fair value less selling costs.
ER
Ernest
2 years ago
User 2
DE
Delmy
2 years ago
User 1
MA
Madelyn
2 years ago
I think the impairment loss would be $1,200.