Bovine Ltd. has the following assets in a CGU: Carrying Value (thousands) Equipment $ 861 Building 2,009 Land 1,170 Goodwill 200 $ 4,240 The recoverable amount has been determined to be $3,340. The separate fair value less costs of disposal for land is $1,070; no other assets could be separately valued. Required: 1. Allocate the impairment loss to individual assets and calculate the net book value of each asset after the impairment. (Enter answers in thousands of dollars.) 2. Assume that the recoverable amount recovered to $3,540 in the subsequent year. Allocate the impairment reversal to individual assets and calculate the net book value of each asset after the impairment. The separate fair value less costs of disposal for land remains at $1,070. There is no concern with a ceiling value when assigning the recovery to building or equipment. (Enter answers in thousands of dollars.)
Bovine Ltd. has the following assets in a CGU: Carrying Value (thousands) Equipment $ 861 Building 2,009 Land 1,170 Goodwill 200 $ 4,240 The recoverable amount has been determined to be $3,340. The separate fair value less costs of disposal for land is $1,070; no other assets could be separately valued. Required: 1. Allocate the impairment loss to individual assets and calculate the net book value of each asset after the impairment. (Enter answers in thousands of dollars.) 2. Assume that the recoverable amount recovered to $3,540 in the subsequent year. Allocate the impairment reversal to individual assets and calculate the net book value of each asset after the impairment. The separate fair value less costs of disposal for land remains at $1,070. There is no concern with a ceiling value when assigning the recovery to building or equipment. (Enter answers in thousands of dollars.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Bovine Ltd. has the following assets in a CGU:
| Carrying Value (thousands) | ||||
| Equipment | $ | 861 | ||
| Building | 2,009 | |||
| Land | 1,170 | |||
| 200 | ||||
| $ | 4,240 | |||
The recoverable amount has been determined to be $3,340. The separate fair value less costs of disposal for land is $1,070; no other assets could be separately valued.
Required:
1. Allocate the impairment loss to individual assets and calculate the net book value of each asset after the impairment. (Enter answers in thousands of dollars.)
2. Assume that the recoverable amount recovered to $3,540 in the subsequent year. Allocate the impairment reversal to individual assets and calculate the net book value of each asset after the impairment. The separate fair value less costs of disposal for land remains at $1,070. There is no concern with a ceiling value when assigning the recovery to building or equipment. (Enter answers in thousands of dollars.)
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education