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Hi,
In section 8.5.5, example 18 in the Study Hub, it says that the carrying amount of the bond would increase by $43,641 & this amount would be shown in SOFP as “Loss Allowance” and as “Impairment Gain” in SOPL.
My question is, how can a GAIN in carrying value be shown as a Loss Allowance? And what exactly is Impairment Gain?
Many Thanks 🙂is this like a reversal of impairment ?
so its reversing the previous expenditure.
Okay, but as per what I understand, loss allowance is like a provision which is supposed to be created against the Assets. Then why is here a gain in Fair Value of the asset being shown as Loss Allowance?
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