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Dear Sir,
Am unable to solve the question below:
Kindly explain to me how we got the impairment loss of 30 , 6 & 9?
Question:
A cash-generating unit has the following net assets:Goodwill 30
Property 60
Plant and equipment 90
Total 180The recoverable amount has been determined and is $135m.
Allocate the impairment loss to the net assets of the entity
Answers:
Goodwill Property Plant Total
Carrying Value 30 60 90 180
Impairment loss (30) (6) (9) (45)
Carrying value 54 81 135
after impairmentImpairment =180-135=45
Impairment is allocated firstly to goodwill.
45-30=15
The remaining 15 impairment must be allocated pro rata among the remaining assets.
Remaining asset value before impairment =60+90=150Allocate impairment pro rata
15/150 x 60=6 impairment property.
15/150 x90=9 impairment plant and equipment.
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