I have a question: I don’t understand what the journal entry should be when recording an impairment if:
1) the asset was held at cost
2) the asset was revalued.
Please help!
Thank you in advance
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Impairment journal entry
10y ago#1DO NOT POST YOUR QUESTIONS TWICE!
1) Dr statement of profit or loss expense
Cr TNCA
2) Dr Revaluation reserve
Cr TNCA
In that second one, we can only debit the revaluation reserve with as large an amount as is already in the revaluation reserve
If the impairment is greater than previous revaluation surpluses not so far treated as realised, then any excess will be debited to statement of profit or loss
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