question archive In measuring an impairment loss, IFRS uses a
In measuring an impairment loss, IFRS uses a
Subject:BusinessPrice:2.87 Bought7
In measuring an impairment loss, IFRS uses
a.undiscounted cash flows.
b.discounted cash flows.
c.a fair value test.
d.a replacement value test
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Answer: c .
An asset is recorded as impaired when its carrying value becomes greater than its recoverable cost. The carrying amount is then reduced and it results in impairment loss. According to IFRS, a fair value test is used to account for an impairment loss on an asset and is recorded immediately in the statement of profit and loss.
