At what point is an asset considered to be impaired?
A) When the net book value is greater than the sum of undiscounted expected cash flows
B) When the net book value is less than the sum of discounted expected cash flows
C) When the net book value is less than the sum of undiscounted expected cash flows
D) When the net book value is greater than the sum of discounted expected cash flows

Question

Quizplus · Accepted Answer

As asset is impaired if its net book value (purchase cost less accumulated depreciation) is greater than the sum of undiscounted cash flows expected to flow from that asset.

At What Point Is an Asset Considered to Be Impaired