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Dear all
it is noed in this question the new investment in Sitin (cost) should be 13m, raising the impairment loss of 3m (16m-13m).
i think the entry should be recorded as follow:
Dr: RE (Grange)
CR:investment in Sitin
The impairment loss test demonstrates this point:
862+2-7+4-3(impairment)=858 858-830=28 impairment loss.
Dr:RE (Grange)
Cr:PPE
I wonder why 3m of impairment loss is excluded in calculation of RE of Grange. The calculaion of RE only deduct the 28m impairment loss.If you have any advice, please tell me.
Thanks
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