Reference no: EM131788433
Problem
SSM Ltd. has determined that its Southwest division is a cash-generating unit. The carrying amounts of the non-current assets in the divison at December 31, 20X5, are as follows:
Building $850,000
Furniture $14,250
Goodwill $70,000
Total $934,250
The division has been assessed for impairment. It is determined that the fair value less cost to sell for division is $812,000 and the value is use (VIU) is $860,000. The building has a fair value less cost to sell $860,000. SSM follows IFRSs.
What would be recorded on December 31, 20X5 financial statements, for the Southwest division?
a) Building will be credited for $4,180
b) Furniture will be credited for $4,250
c) Goodwill will be credited for $74,250
d) There is an impairment loss of $122,25.