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Question 8 At the end of 2017, Blue Spruce Corporation owns a licence with a remaining life of 8 years and a carrying amount of

Question 8

At the end of 2017, Blue Spruce Corporation owns a licence with a remaining life of 8 years and a carrying amount of $525,000. Blue Spruce expects undiscounted future cash flows from this licence to total $531,000. The licences fair value is $419,700 and disposal costs are estimated to be nil. The licences discounted cash flows (that is, value in use) are estimated to be $470,900. Blue Spruce prepares financial statements in accordance with IFRS.

(a)

Determine if the licence is impaired at the end of 2017.
The licence

is not impairedis impaired

at the end of 2017.
Prepare any related entry that is necessary. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation

Debit

Credit

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