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Mesh Itd. has identified an impairment loss of $20 000 on one of its Cash- Generating Units (CUs). The CGU consists of the following assets
Mesh Itd. has identified an impairment
loss of $20 000 on one of its Cash-
Generating Units (CUs). The CGU
consists of the following assets (stated at
current carrying amounts): Land $350
000 Building Mesh Itd. has identified an
impairment loss of $20 000 on one of its
Cash-Generating Units (CUs). The CGU
consists of the following assets (stated at
current carrying amounts):
Land $350 000
Building $500 000
Equipment $300 000
Fittings $150 000
The Recoverable
Amount of the building is $490,000.
1a
Calculate the allocation of the impairment
loss against all assets in the CGU.
1b
Record the journal entries to account for
the impairment loss.
2 An item of depreciable equipment is acquired on 1 July 2018 for $150 000. It is expected to
have a useful life of 5 years and a zero
residual value, On 1 July 2020, it is
decided to revalue the asset to its fair
value of $140 000. Provide journal entries
to account for the revaluation.
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