Palm Beach Ltd Has a Cash Generating Unit (CGU)and Has

question 66

Multiple Choice

Palm Beach Ltd has a cash generating unit (CGU) and has been assessed for impairment and it has determined an impairment loss of $100 000. The following information relates to the assets as at 30 June 2012. $$\begin{array} { | l | r | r | } \hline & \text { Carrying amount } & \text { Recoverable amount } \\\hline \text { Buildings } & 800000 & 900000 \\\hline \text { Equipment } & 200000 & 150000 \\\hline \text { Goodwill } & 50000 & \\\hline\end{array}$$ In accordance with AASB 136 Impairment of Assets what should be the carrying amount of equipment as at 30 June 2012?

• A) $0
• B) $100 000
• C) $150 000
• D) $190 000

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Definitions:

Net Of Tax

Refers to the amount remaining after taxes have been deducted, used to describe financial results or figures that are exclusive of tax effects.

Net Realizable Value

Net realizable value is the estimated selling price of goods, minus the estimated costs of completion and the costs necessary to make the sale.

Interim Financial Report

A financial report covering a period of less than one fiscal year that provides an update on a company's financial status.

Inventory

The raw materials, work-in-process products, and finished goods that are considered to be the portion of a business's assets that are ready or will be ready for sale.