Which of the following statement is NOT correct? Select one: a. When the carrying amount of an asset is less than the recoverable amount, then an asset should have its previous impairments reversed to the value of the recoverable amount provided there is accumulated amortization to cover the difference. b. The difference between the carrying amount of an asset and the recoverable is the impairment loss if the carrying amount is greater. c. When the carrying amount of an asset is greater than the recoverable amount, then an asset should be impaired to the value of the recoverable amount d. The difference between the carrying amount of an asset and the recoverable is the impairment loss if the carrying amount is less.

Which of the following statement is NOT correct? Select one: a. When the carrying amount of an asset is less than the recoverable amount, then an asset should have its previous impairments reversed to the value of the recoverable amount provided there is accumulated amortization to cover the difference. b. The difference between the carrying amount of an asset and the recoverable is the impairment loss if the carrying amount is greater. c. When the carrying amount of an asset is greater than the recoverable amount, then an asset should be impaired to the value of the recoverable amount d. The difference between the carrying amount of an asset and the recoverable is the impairment loss if the carrying amount is less.

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter5: Adjusting Entries And The Work Sheet

Section: Chapter Questions

Problem 4TF: LO1 Depreciable cost is the difference between the original cost of the asset and its accumulated...

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(Multiple Choice Question) An impairment loss is recorded when capital asset's 1. net book value is higher than the amount it could likely be sold for 2. market value is higher than its accumulated amortization 3. market value is higher than its net book value 4. net book value is higher than its accumulated amortization
Question 1 Which of the following is not correct in relation to the reversal of an impairment loss of an individual asset? If the individual asset is recorded under the cost model, then the increase in the carrying amount is recognised immediately in profit or loss. Where the recoverable amount is less than the carrying amount of an individual asset, the reversal of a previous impairment loss requires adjusting the camying amount of the asset to recoverable amount. When reversing an impairment loss, the carrying amount cannot be increased to an amount in excess of the carrying amount that would have been determined had ne impairmert los been recognised. O For a depreciable asset there needs to be a calculation of carrying amount using the depreciation variables applied before the impairment loss to determine what the carrying amount would have been if there had been no impairment loss.
1)If an asset value recovers after an impairment loss has been recognized for the asset, what amount of restoration of that loss is recognized?a.The difference between the original cost and the new recoverable amount.b.The difference between the original loss and the new recoverable amount.c.The difference between the carrying amount and the new recoverable amount.d.None of the recovered value is recognized.2) Occasionally, events occur that change an asset's value after purchase. Which of the following is true regarding these changes in value?a.Increases in asset value are recognized.b.Reductions in asset value are recognized.c.Both decreases and increases are recognized.d.Neither decreases nor increases are recognized.
Impairment loss is a situation whenSelect one:a. Carrying amount of an asset is greater than recoverable amount of it.b. Carrying amount of an asset is smaller than that of recoverable amount of it.c. Carrying amount of an asset is equal to recoverable amount of it.d. Correct option is not listed
LO1 Depreciable cost is the difference between the original cost of the asset and its accumulated depreciation.
Your asset is impaired: its 'fair value less costs to sell' is OMR 4k and its value in use' is OMR 6k. Carrying value of the asset is OMR 8k. Which is the value of asset in the statement of financial position after impairment? O a. OMR 8k. O b. Loss of OMR 2k. O c. Zero. O d. OMR 6k.
A) What is residual value? Support your answer with an example ( word count 100) B) In practise, would you expect the depreciation expense for a non-current asset to be overestimated or underestimated? Explain why this is the case.
Which of the following is a CORRECT statement about long-term asset impairment? A. Under U.S. GAAP, an asset that has been written down because of impairment can be written back up if it increases in value in the future. B. An asset is impaired if the net book value is less than the expected future cash flows. C. If an asset is impaired, the expected future cash flows will exceed the fair value of the asset. D. If an asset is impaired, the impairment loss is the difference between the net book value and the fair value.
Once an asset has been determined to be impaired, the amount of impairment is measured as: The asset's cost minus the fair value The asset's future cash inflows minus the book value The asset's book value minus the fair value The asset's cost minus the book value
Which of the following situations indicates that an asset is impaired?a. The net book value of the asset is less than the asset’s estimated future cash flows.b. The net book value of the asset is more than the asset’s estimated future cash flows.c. The fair market value of the asset is less than the asset’s net book value.d. The fair market value of the asset is more than the asset’s net book value.
What is an impairment loss? A ) The amount by which the carrying amount of an asset exceeds the book value B ) The amount by which the carrying amount of an asset exceeds the recoverable amount C ) The difference between the fair value of an asset and the net realisable value of the asset D ) The amount by which the market value of an asset exceeds the net present value
Which of the following is a false statement regarding revaluation of PPE?A. Revalued amount is either fair value or depreciated replacement cost.B. If simultaneous revaluation is not possible, revaluation can be done on arolling basis provided revaluation of the class of assets is completed withina short period of time and provided the revaluations are kept up to date.C. The difference between the PPE’s carrying amount and its revalued amount isknown as revaluation surplus and should be presented in the statement ofcomprehensive income, net of applicable tax.D. When an asset's carrying amount is increased as a result of revaluation, theincrease shall always be credited to revaluation surplus regardless of theexistence of previous impairment loss recognized. Which of the following should be included as cost of inventory?A. Depreciation expense of the delivery equipment.B. Depreciation expense of the factory machinery.C. Storage cost of finished goods.D. None from the choices. In…