An asset is impaired when the asset's carrying value is:
A) Greater than the sum of discounted expected cash flows.
B) Less than the sum of discounted expected cash flows.
C) Less than the sum of undiscounted expected cash flows.
D) Greater than the sum of undiscounted expected cash flows.
E) None of the above

Question

Quizplus · Accepted Answer

An asset is considered impaired when its carrying value exceeds the sum of its undiscounted expected cash flows, indicating that the asset may not be recoverable.

An Asset Is Impaired When the Asset's Carrying Value Is