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25 November, 13:09

An asset group is being evaluated for an impairment loss. The following financial information is available for the asset group: Carrying value Sum of the undiscounted cash flows Fair value $100,000,000 95,000,000 80,000,000 What amount of impairment loss, if any, should be recognized

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  1. 25 November, 15:35
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    The amount of impairment loss that should be recognized is $20,000,000

    Explanation:

    In order to calculate the amount of impairment loss that should be recognized we would have to make the following calculation:

    amount of impairment loss=Carrying value - Fair value

    Carrying value=$100,000,000

    Fair Value=$80,000,000

    Therefore, amount of impairment loss=$100,000,000-$80,000,000

    amount of impairment loss = $20,00,000

    The amount of impairment loss that should be recognized is $20,000,000
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