Parta Explain why for some assets, impairment testing may require the use of CGUs, rather than being based on a single asset. Part b One of the CGUs of Simon Ltd is associated with the manufacture of wine barrels. At 30 June 2019, Simon Ltd believed, based on an analysis of economic indicators, that the assets of the unit were impaired. The carrying amounts of the assets and liabilities of the unit on 30 June 2019 were: $ 210 000 (90 000) Buildings Accumulated depreciation - buildings* Factory machinery Accumulated depreciation - machinery** Goodwill 110 000 (20 000) 7 500 Inventories 40 000 20 000 (2 500) Receivables Allowance for doubtful debts Cash Accounts payable 10 000 15 000 Loans 10 000 *Depreciated at $30 000 p.a. **Depreciated at $22 500 p.a. Simon Ltd determined the recoverable amount of the unit to be $267 500. The receivables were considered to be collectable, except those considered doubtful. The company allocated the impairment loss in accordance with AASB 136/IAS 36. During the 2019-20 period, Simon Ltd increased the depreciation charge on buildings to $32 500 p.a., and to $25 000 p.a. for factory machinery. The inventories on hand on 1 July 2019 were sold by the end of the year. On 30 June 2020, Simon Ltd, because of a return in the market to the use of traditional barrels for wines and an increase in wine production, assessed the recoverable amount of the CGU to be $10 000 greater than the carrying amount of the unit. As a result, Simon Ltd recognised a reversal of the impairment loss. Required Prepare all the journal entries for Simon Ltd on 30 June 2019 and 30 June 2020 related to impairment and the reversal. (Show all the workings and round off to the nearest whole number). Parta Explain why for some assets, impairment testing may require the use of CGUS, rather than being based on a single asset. Part b Working Space Impairment Loss Journal Entry as at 30 June 2019 Date Description Account Dr CR