Deck 15: Impairment and Disposal of Assets

Question 1

IFRS 5 stipulates that losses on discontinued business should be disclosed as a single amount;

A)in the notes to the income statement.
B)on the face of the income statement.
C)as a line in the capital reserves.
D)as a line in the revenue reserves.

Answer 1

B

Question 2

IAS 36 can be applicable to current assets in some circumstances.

Answer 2

True

Question 3

IAS 36 requires assets within its scope to be recorded at the lower of cost and market or fair value.

Answer 3

False

Question 4

If a newly acquired asset is classified as held for sale it should be valued at;

A)the lower of fair value and cost.
B)the lower of cost and fair value .
C)the lower of replacement cost and fair value.
D)the lower of fair value and replacement cost.

Question 5

An entity must test an intangible asset with an indefinite useful life not yet available for use for impairment annually.

Question 6

An asset which is to be abandoned cannot be classified as 'held for sale'.

Question 7

Both depreciation and impairment can be considered to be a downward slope.

Question 8

To which of the following assets does IAS 36 apply?

A)deferred tax assets
B)deferred acquisition costs
C)non-current assets classified as held for sale
D)investments in subsidiaries

Question 9

When a non-current asset is classified as held for sale the appropriate depreciation policy is;

A)straight line.
B)no depreciation.
C)declining balance.
D)usage based.

Question 10

A cash generating unit has the following values; Goodwill = €30,Property =€60 & Plant = €90.An impairment loss of €45 is suffered.After allocation of the impairment loss what is the carrying value of the property?

A)€54
B)€45
C)€30
D)€15