Technique Co.has equipment with a carrying amount of $800,000.The equipment's fair value less costs to sell is $780,000, and its value-in-use is $815,000.The equipment is expected to be used in operations in the future.What amount (if any) should Technique report as an impairment to its equipment?

Question

Quizplus · Accepted Answer

The recoverable amount is the higher of fair value less costs to sell ($780,000) and value-in-use ($815,000). Since the carrying amount ($800,000) is less than the recoverable amount ($815,000), no impairment should be reported.