lued amount 80 (13.3) 66.7 Plant and equipment, at cost 100 (16
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On 30 June 2018, HTL Bhd classifies a business segment as a disposal group for sale. The
carrying amount and the impairment loss recognised are as follows:
Before
RM’m
Impairment
RM’m
After
RM’m
Property, at revalued amount 80 (13.3) 66.7
Plant and equipment, at cost 100 (16.7) 83.3
AFS investment at fair value 40 - 40
Other monetary assets 30 - 30
Net amount 300 (80) 220
On 31 December 2018, the fair value of the AFS investment increase to RM45m. On this
date, HTL Bhd signs an agreement with a third party to dispose of the business for a
consideration of RM240m. Costs to sell are estimated at 3% of the consideration.
Required:
Compute the reversal of impairment loss that shall be recognised on 31 December 2018.
Step by step
Solved in 2 steps
- On 30 June 2018, HTL Bhd classifies a business segment as a disposal group for sale. The carrying amount and the impairment loss recognised are as follows: Before RM'million Impairment RM'million After RM'million Goodwill allocated 50 950 - Property, at revalued amount 80 (13.3) 66.7 Plant and equipment, at cost 100 (16.7) 83.3 AFS investment at fait value 40 - 40 Other monetary assets 30 - 30 Net amount 300 (80) 220 On 31 December 2018, the fair value of the AFS investment increase to RM45m. On this date, HTL Bhd signs an agreement with a third party to dispose of the business for a consideration of RM240m. Costs to sell are estimated at 3% of the consideration. Required: Compute the reversal of impairment loss that shall be recogniZed on 31 December 2018.On 31 December 2018, the fair value of the AFS investment increase to RM45m. On thisdate, HTL Bhd signs an agreement with a third party to dispose of the business for aconsideration of RM240m. Costs to sell are estimated at 3% of the consideration.Required:Compute the reversal of impairment loss that shall be recognised on 31 December 2018.Wilson Corporation is performing the test of impairment of its Technology reporting unit at the end of the year. Wilson has determined the fair value of the unit using a multiple of earnings approach at $2,000,000. The carrying value of the net assets of the Technology unit is $2,100,000. What should Wilson do with this information? a) Record an impairment loss of $100,000. b) Record no impairment loss. c) Perform step 2 of the test of impairment. d) Value goodwill individually.
- On 1st January 2019, Maali limited had an old machinery with a cost of Rwf 16,000 and accumulated depreciation of Rwf 5,000. An impairment loss of Rwf 1,000, had previous been provided. Depreciation charged provided per year is Rwf 1,100. On 31st December 2021, a revaluation was done that revealed a fair value of Rwf 9,600. Required: Based on requirement s of IAS 16 and 36, Discuss how impairment loss was treated Compute revaluation surplus and discuss how it was treated Discuss how gain on disposal and revaluation surplus balance should be treated upon de-recognition of the asset.Enter Co. determined the following information for the purpose of testing its investment in associate for impairment: Carrying amount of investment (including ₱100,000 goodwill) 1,600,000 Fair value less costs of disposal (FVLCD) 1,440,000 Value in use (VIU) 1,380,000 How much is the impairment loss? 160,000 b. 220,000 c. 60,000 d. 0The ABC Company accounts for non-current assets using the cost model. On July 20, 2021, ABC Company classified a non-current asset as held for sale in accordance with PFRS 5. At that date, the asset's carrying amount was P24,500, its fair value was estimated at P31,500 and the costs to sell at P3,150. The asset was sold on Oct 18, 2021 for P31,200. Q-27. 12.How much is the impairment loss and at what amount should the asset be stated in ABC Company's statement of financial position at September 30, 2021? 13.How much is the gain on sale to be reported in the September 30, 2021 statement of income?
- Jhon Ltd anticipated that its assets may be impaired in June 2020. The land is measured by Jhon Ltd at fair value. On 30 June 2020, the entity revalued the land to its fair value of $13 000. The land had previously been revalued upwards by $2 000. As a result of its impairment testing, John Ltd calculated that the recoverable amount of the entity’s assets was $148 600. The carrying amounts of the assets of John Ltd prior to adjusting for the impairment test and the revaluation of the land was as follows. Non-current assets Buildings $340 000 Accumulated depreciation (77 600) Land (at fair value 1/7/2019) 51 200 Plant and equipment 581 600 Accumulated depreciation (300 000) Goodwill 24 000 Accumulated impairment losses (17 600) Trademarks — labels 32 000 Current assetsCash 5 800 Receivables 2 600 Required: Prepare the journal entries required on 30 June 2020 in relation to the measurement of the assets of John Ltd. Assume that, as the result of the allocation of the impairment loss,…25 On 1/1/2019 Company A acquired the net assets of Company B for a price of 400000 JD the fair value of identifiable net assets of company B is 300000 JD. On 1/1/2020 the fair value of unit is 380000 JD, carrying value of net assets (excluding goodwill) 310000 JD fair value of identifiable net assets (INA) 330000. Compute impairment loss. Select one: a. 40000 b. 50000 c. 60000 d. No impairmentThe following trial balance relates to Golden Ltd at 30th September 2018GHS'000GHS'000Sales (a)760,000Material purchases (b) 128,000Production labour (b) 248,000Factory overheads (b) 160,000Distribution costs 28,400Administrative expenses (c) 92,800Finance costs 700Investment income1,600Leased property - at cost (b) 100,000Plant and equipment - at cost (b) 89,000Accumulated amortisation/depreciation at 1/10/2017- leased property20,000- plant and equipment29,000Equity investments (e) 36,000Inventory at 1/10/17 93,400Trade receivables 67,100Trade payables55,600Bank4,600Stated capital (GHS0.2)100,000Income surplus (1/10/2017)67,200Deferred tax (f)5,4001,043,4001,043,400The following notes are relevant:(a) Sales include goods sold and dispatched in September 2018 on a 30-day right of return basis. Their sellingprice was GHS4.8m and they were sold at a gross profit margin of 25%. In the past, Golden Ltd’scustomers have always met their obligations under this type of agreement.(b)…
- N Incorporated plans to dispose a group of assets that form part a disposal group. These assets have the following data on December 31, 2021: Asset Carrying value Inventory 2 million Equipment 5 million Land 20 million Building 15 million Goodwill 3 million Total 45 million The carrying value of the inventory is equal to its net realizable value. On the date of reclassification, the fair value less cost to sell of the disposal group is 40 million. Impairment loss to be recognized on the date of reclassification is: a. 3,000,000 b. 2,000,000 c. 5,000,000 d. Answer not among the choices e. 0 Clear my choiceA Ltd owns an owner-occupied asset that is measured using the revaluation model. The asset’scarrying amount at the end of the financial year is R20 000. The fair value of the asset is R27 000.The entity has determined the fair value less costs to sell of the asset as R26 000 and the value inuse as R32 000.Required:Explain how you would calculate the carrying value of the asset and at what value the asset shouldbe presented at in the financial statements.The information below is from the Takafel Company.: 1. Investment property is acquired August 11, 2008, at a cost of BD2100. 2. The Fair values of the investment property is determined by the company as follows: § On December 31, 2008 - BD2000 § On December 31, 2009 - BD2080 § On December 31, 2010 - BD2150 Assume that the company used Fair value model (FVM), do the necessary entries at the end of 2008, 2009 and 2010.
