Madison Company acquired a depreciable asset at the beginning of Year 1 at a cost of $12 million and 6 years useful life. At December 31, Year 1, Madison gathered the following information related to this asset: Fair value of the asset (net selling price) . . . . . . . . . . . . . . . . . . . . . . . . $7.5 million Sum of future cash flows from use of the asset . . . . . . . . . . . . . . . . . . $10 million Present value of future cash flows from use of the asset . . . . . . . . . . . $8 million Impairment loss of the asset at end of year 1 (if any) Select one: a. IFRS $0 and US GAAP: $ 2 million b. IFRS $2.5 million and US GAAP $2 million c. IFRS $2 million and US GAAP $0 million d. IFRS $4 million and US GAAP $0 million
Madison Company acquired a
At December 31, Year 1, Madison gathered the following information related to this asset:
Fair value of the asset (net selling price) . . . . . . . . . . . . . . . . . . . . . . . . $7.5 million
Sum of future cash flows from use of the asset . . . . . . . . . . . . . . . . . . $10 million
Present value of future cash flows from use of the asset . . . . . . . . . . . $8 million
Impairment loss of the asset at end of year 1 (if any)
Select one:
a. IFRS $0 and US GAAP: $ 2 million
b. IFRS $2.5 million and US GAAP $2 million
c. IFRS $2 million and US GAAP $0 million
d. IFRS $4 million and US GAAP $0 million
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