Cementco Inc. has the following assets in a CGU: Building – CV – $60,000, Equipment – CV – $40,000, Goodwill – CV – $20,000. If they calculate an impairment loss of $30,000 for the CGU, what is the carrying value of the building, equipment and goodwill after applying the impairment loss to these assets under IFRS?

Cementco Inc. has the following assets in a CGU: Building – CV – $60,000, Equipment – CV – $40,000, Goodwill – CV – $20,000. If they calculate an impairment loss of $30,000 for the CGU, what is the carrying value of the building, equipment and goodwill after applying the impairment loss to these assets under IFRS?

The goodwill would be written off completely so the carrying value is 0.  The remaining $10,000 would be applied against the building and equipment based on carrying value – 60% building and 40% equipment.  Therefore, the revised carrying value of the building would be $54,000 ($60,000 – $6,000) and the equipment would be $36,000 ($40,000 – $4,000).

Bookmark (3)
✕
PASS Your CPA

FREE
VIEW