Firms conduct an impairment test whenever impairment indicators indicate that an asset may be impaired.

Name: Firms conduct an impairment test whenever impairment indicators indicate that an asset may be impaired.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Firms are required to conduct an impairment test whenever impairment indicators suggest that an asset may be impaired. This is done to determine whether the carrying value of the asset exceeds its recoverable amount, and if so, to recognize an impairment loss.

Firms Conduct an Impairment Test Whenever Impairment Indicators Indicate That