Which of the Following Statement Is Incorrect Regarding How the IASB

question 22

Multiple Choice

Which of the following statement is incorrect regarding how the IASB requires that the impairment assessment be performed?

• A) Receivables that are individually significant should be considered for impairment separately, if impaired, the company recognizes it.
• B) Receivables that are not individually significant are assessed individually. If impaired, the company recognizes it.
• C) Any receivable individually assessed that is not considered impaired should be included with a group of assets with similar credit-risk characteristics and collectively assessed for impairment.
• D) Any receivables not individually assessed should be collectively assessed for impairment.

---

Definitions:

Periodic Inventory Method

An accounting method which involves physically counting the inventory at specific intervals to determine the cost of goods sold and the ending inventory balance.

Income Summary

An account used in the closing process that aggregates all income and expenses to determine the net income or loss for the period.

Merchandise Inventory

The goods a company has available for sale to customers, considered a current asset on the balance sheet.