Walther-Neiderhausen, a publisher, has purchased a brand name from another publisher that focuses on publishing non-fiction books. The brand name suffered some negative publicity which may have damaged the brand name. An impairment test is required.

Question

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An impairment test is necessary when there are indicators that an asset, such as a brand name, may have lost value. Negative publicity affecting the brand name suggests its value might have been diminished, warranting an impairment test to assess its current worth.

Walther-Neiderhausen, a Publisher, Has Purchased a Brand Name from Another