Collision and Ryder Company (C&R) has been experiencing declining market condtions for its sportswear division. Management decided to test the assets of the division for possible impairment. The test revealed the following: book value of division's assets, $28.9 million; fair value of division's assets, $22.2 million; undiscounted sum of estimated future cash flows generated from the division's assets, $29.2 million. What amount of impairment loss should C&R recognize?
Collision and Ryder Company (C&R) has been experiencing declining market condtions for its sportswear division. Management decided to test the assets of the division for possible impairment. The test revealed the following: book value of division's assets, $28.9 million; fair value of division's assets, $22.2 million; undiscounted sum of estimated future cash flows generated from the division's assets, $29.2 million. What amount of impairment loss should C&R recognize?
Auditing: A Risk Based-Approach to Conducting a Quality Audit
10th Edition
ISBN:9781305080577
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Chapter16: Advanced Topics Concerning Complex Auditing Judgments
Section: Chapter Questions
Problem 57RSCQ
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Collision and Ryder Company (C&R) has been experiencing declining market condtions for its sportswear division. Management decided to test the assets of the division for possible impairment. The test revealed the following: book value of division's assets, $28.9 million; fair value of division's assets, $22.2 million; undiscounted sum of estimated future
What amount of impairment loss should C&R recognize?
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