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Illustration 7 There was an explosion in a factory. The carrying amounts of its asset were as follows: The factory operates as a cash generating
Illustration 7 There was an explosion in a factory. The carrying amounts of its asset were as follows: The factory operates as a cash generating unit. An impairment review reveals a net selling price of GHS1.2 million for the factory and value in use of GHS1.95 million. Half of the machines have been blown to pieces but the other half can be sold for at least their book value. The patents have been superseded and are now considered worthless. Show the effect of the explosion on the asset values
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