How Does the Definition of Asset Impairment Differ Between IAS

question 21

Multiple Choice

How does the definition of asset impairment differ between IAS 36 and U.S. GAAP?

• A) U.S. GAAP does not consider selling price in determining impairment, but IAS 36 does.
• B) U.S. GAAP considers cash flows in assessing value of continued use, but does not discount them, whereas IAS 36 requires discounting in assessing asset impairment.
• C) Asset impairment is more likely to occur under IAS 36 than under U.S. GAAP.
• D) All of the above are differences between IAS 36 and U.S. GAAP.

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Definitions:

Standard Cost

The pre-determined and benchmarked cost of manufacturing a single unit of product, which is used for budgeting and performance evaluation.

Schedule Adherence

A measure of how closely a project or production follows the planned schedule or timeline.

Balanced Scorecard

A strategic planning and management system that organizations use to communicate what they are trying to accomplish, align day-to-day work with strategy, prioritize projects, and measure progress.

Efficiency And Quality

Measures of how well resources are used to achieve objectives and the degree to which products or services meet customer expectations.