The Limoncello Co. is considering whether according to IAS 36 - 'Impairment of Assets', any impairment loss has occurred on its major factory on the Amalfi Coast:
Current carrying value (i.e. cost less accumulated depreciation), € 80m
Value in use, € 120m
Fair value less cost of disposal, € 60m
What is the amount of the impairment loss to be recognised and what is the factory's carrying value after the recognition of any impairment loss?
Your Answer:
Impairment loss: Nil; Carrying value: € 120,000
Correct Answer:
Impairment loss: Nil; Carrying value: € 80,000
The recoverable amount is exceeding the carrying value by 40,000. Do we not mention it as 120,000?
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Impairments
I mean should it not be revalued?
7y ago#2it will only be revalued if the company use revalution model for the subsequent years.. by default assume company use cost model( cost-acc.DEP)
Thanks.
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