T or F: If an impairment loss is recognized under the US. GAAP later recovery of the loss is prohibited
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7. T or F: If an impairment loss is recognized under the US. GAAP later recovery of the loss is prohibited
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- Do U.S. GAAP and IFRS (under IAS No. 39) differ in how they account for otherthan- temporary impairments? Explain.Based on Appendix 12B) How does IFRS differ from current U.S. GAAP in accounting for other-thantemporary impairments?12. Which of the following statements about the requirements of IFRS 5 is incorrect? a. At the end of the reporting period, when the fair value less costs to sell decreases from the initial recognition of the asset as held for sale, an impairment loss shall be recognized in profit or loss. b. At the end of die reporting period, when the fair value less costs to sell decreases from the initial recognition of the asset as held for sale, an impairment loss shall be recognized in other comprehensive income. c. An entity shall recognize gain from subsequent increase in fair value less cost to sell of an asset O held for sale, but not in excess of the cumulative unrecovered impairment loss recognized for that asset. d. An entity may reclassify an asset held for sale to an asset held for use when management changes its plan for the sale and decides to use the asset for operations.
- How does IFRS differ from current U.S. GAAP with respect to accounting for impairments?The term "provision" as it is used in IAS 37, is most closely related to what term in U.S. GAAP? O Contingent liability, where the outflow of resources is "remote." Contingent liability, where the outflow of resources is "probable." O Current liability, where the outflow is difficult to measure. Reserve for bad debt, where the amount recoverable is "uncertain."Explain the differences between US GAAP and IFRS in the calculation of a goodwill impairment loss in a concise manner.
- 7. Which of the following must be done when accounting for depreciation under IFRS GAAP but can be done under U.S. GAAP? a. Depreciate by function b. Depreciate by nature c. Depreciate by components d. All of these 8. When accounting for contingent liabilities IFRS GAAP defines ‘probable’ as a. likely b. more likely than not c. possible d. none of these 9. When accounting for contingent liabilities U.S. GAAP defines ‘probable’ as a. likely b. more likely than not c. possible d. none of theseJust briefly describe how impairment losses for goodwill are calculated under U.S. GAAP and IFRS, respectively.8. How do SMEs account for impairment losses on CGUs? a. The impairment loss is charged first to goodwill and any excess is allocated to the other assets of the CGU pro rata on the basis of the carrying amount of each asset in the CGU. b. The impairment loss is allocated only to the other assets of the CGU pro rata on the basis of the carrying amount of each asset in the CGU because an SME shall not recognize any goodwill. c. There is no accounting for impairment losses on CGUs because an SME needs only to account for individual assets rather than groups of assets such as CGUs. d. b and c.
- 33. the commercial package policy declarations contain interlines enduements cause of loss forms common policy conditions d description of the property insuredUnder the IAS 16, there is an impairment loss of property, plant and equipment if?Under IFRS, a loss from the destruction of property in a fi re would most likely be classifi ed as: A . an extraordinary item.