Question
It is now 26 June 2020 and as the financial controller of Cookie SwirlC Ltd (a public listed company) you are in the process of
It is now 26 June 2020 and as the financial controller of Cookie SwirlC Ltd (a public listed company) you are in the process of finalising the financial statements of Cookie SwirlC Ltd for the financial year ended 31 March 2020. Cookie SwirlC Ltd has hired three assistant accountants recently to assist you in coping with the year-end close and accounting workload. The scenarios below relate to specific events which may have an impact on the Company reporting. All amounts in the information below are material. The tax rate is 30%.
(i) At 31 March 2020, Cookie SwirlC Ltd analysed the internal and external sources of information that would indicate deterioration in the worth of its assets. It determined that there were indications of impairment for a cash-generating unit (CGU). Cookie SwirlC Ltd reported the following information of the cash generating unit in its statement of financial position at 31 March 2020 and calculated the recoverable amount of this CGU to be $900,000:
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