Brighton Shores Plc has a cash generating unit (CGU)and has been assessed for impairment and it has determined an impairment loss of £100 000. The following information relates to the assets as at 30 June 2014. $$\begin{array} { | l | r | r | }
\hline & \text { Carrying amount } & \text { Recoverable amount } \
\hline \text { Buildings } & 800000 & 900000 \
\hline \text { Equipment } & 200000 & 150000 \
\hline \text { Goodwill } & 50000 & \
\hline
\end{array}$$ In accordance with IAS 36 Impairment of Assets what should be the carrying amount of buildings as at 30 June 2014?

Question

Brighton Shores Plc has a cash generating unit (CGU)and has been assessed for impairment and it has determined an impairment loss of £100 000. The following information relates to the assets as at 30 June 2014. $$\begin{array} { | l | r | r | } 
\hline & \text { Carrying amount } & \text { Recoverable amount } \
\hline \text { Buildings } & 800000 & 900000 \
\hline \text { Equipment } & 200000 & 150000 \
\hline \text { Goodwill } & 50000 & \
\hline
\end{array}$$ In accordance with IAS 36 Impairment of Assets what should be the carrying amount of buildings as at 30 June 2014?

Quizplus · Accepted Answer

The carrying amount of the buildings remains unchanged at £800,000 because its recoverable amount (£900,000) is higher than its carrying amount, indicating no impairment for the buildings. The impairment loss should be allocated to goodwill and equipment.

Brighton Shores Plc Has a Cash Generating Unit (CGU)and Has