Reference no: EM133044475

Question -

a. Lacey Limited expected future cash flows from the use of plant as follows: End of Year 1 $14 000; End of Year 2 $15 000; End of Year 3 $12 000. The discount rate was determined as 9%. What is the value in use of the plant?

b. Parkes Limited recognised an impairment loss of $20 000 against a cash-generating unit containing the following assets: buildings $50 000; roads $110 000; equipment $40 000. What is the net carrying amount of the roads after allocation of the impairment loss?

c. Berry Pty Ltd has two cash generating units. CGU A had a carrying amount of $1700 and value in use of $1750. CGU B has a carrying amount of $1900 and a value in use of $1800. The carrying amount of the head office assets is $1400. CGU A and B utilise the head office services equally. What is the impairment loss for CGU A?

d. During 2021, Simpson Limited estimated that the carrying amount of goodwill was impaired by $20 000. In 2022, the company reassessed goodwill and determined that the goodwill initially acquired still existed. What is the appropriate accounting treatment in 2022? Explain.