Bramble Corp. owns machinery with a book value of $750000. It is estimated that the machinery...
Bramble Corp. owns machinery with a book value of $750000. It is estimated that the machinery will generate future cash flows of $712000. The machinery has a fair value of $551000. Bramble should recognize a loss on impairment of:
Homework Answers
Answer
--Recoverable value is the HIGHER of:
>fair value $ 551,000
>value in use $ 712,000
--Hence, Recoverable amount = $ 712,000
--Impairment loss = Book Value - recoverable amount
= $ 750000 - 712000
= $ 38,000 Answer
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