- This topic has 1 reply, 1 voice, and was last updated 7 years ago by .
Viewing 2 posts - 1 through 2 (of 2 total)
Viewing 2 posts - 1 through 2 (of 2 total)
- You must be logged in to reply to this topic.
OpenTuition recommends the new interactive BPP books for June 2024 exams, Get your discount code >>
Forums › ACCA Forums › ACCA SBR Strategic Business Reporting Forums › Cash Generating Unit
Dears, I hope you doing well
I’ve this question and I need the explanation of the answer please , I need to learn not just the correct answer, Thanks in advance…
Lollipop SA held a cash generating unit at $850,000. There was evidence of impairment at the year end and so Lollipop determined that the cash generating units fair value was $ 900,000, but to sell the unit, Lollipop would incur costs of $75,000. The discounted present value of the future cash flows of the cash generating unit was $ 775,000.
What impairment should Lollipop recognise in its statement of profit or loss in relation to the cash generating unit?
A. $25,000
B. $nil
C. $75,000
D. $100,000
Thank you so much , I think this is the correct answer , the main key here as you mentioned is RA should be the higher of i. FV less cost to sell or ii. PV of its value in use.
Thanks again
I will post more questions and I will be very happy if you help me as you did now