The smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets is referred to as a/an:
A)small-group unit.
B)cash-generating unit.
C)identifiable unit.
D)independent unit.

Question

Quizplus · Accepted Answer

The term used to describe the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets is a cash-generating unit (CGU). This is important in determining the value of an asset or group of assets for accounting purposes. A CGU must be identified in order to determine if there has been any impairment in the value of the asset, which can have significant financial implications for a company.

The Smallest Identifiable Group of Assets That Generates Cash Inflows