IMPAIRMENT

Hi sir, i would like to ask regarding revaluation loss and there is revaluation surplus in other component of equity in previous year.

The question is

You have been provided with the following information

Cost of machine : 200 000
Useful life : 5 years
Date of purchased : 1 January 2016

On 1 july 2017, the value of the machine has declined due to lower demand for the entity’s product. The Information with regards to the machine:

Fv – cts 120 000
Value in use 110 000

You were told that the machine has a revaluation surplus of 10 000 in the other component of equity for the year ended 31 dec 2016

Determine the amount shown in profit or loss for the year ended 31 dec 2017.

With regards to this question, i have understand that the working to answer is as below

Impairment: 120 000 – 140 000(200k -(200k / 5 x 1.5)) = 20 000

Depreciation: 20k ( 6 months) + 17 143 ( 120k / 3.5 x 6/12) = 37143

And the answer is 57 143.

The problem is, i just got confused why does the Impairment of 20 000 did not set off from the previous revaluation surplus of 10 000? Which make the amount of impairment in sopl will be only 10 000 instead of 20 000?

Because, my previous understanding is any impairment loss which previously revalued surplus can be set off and any excess will be taken to sopl as expenses.

I hope you can help me in understanding this matter 🙁 thank you sir