An Impairment Loss Can Be Reversed When

question 20

Multiple Choice

An impairment loss can be reversed when:

• A) there is no indication that the impairment loss no longer exists or has been reduced and there has not been a change in the estimates used to determine the assets recoverable amount.
• B) with the exception of goodwill, all intangible assets carrying values exceed their fair market values.
• C) the intangible assets carrying values exceed their undiscounted future cash flows.
• D) with the exception of goodwill, the recoverable amount is determined and compared to the carrying amount. If the recoverable amount is greater than the carrying amount then the impairment loss previously recorded is reversed.

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Definitions:

Federalism

A system of government in which power is divided between a central authority and constituent political units.

Govern Authority

Pertains to the legal power or right held by a government body to regulate, control, or manage individuals, entities, or property.

Supremacy Clause

A provision in the U.S. Constitution stating that federal law takes precedence over state laws.

Supreme Law

The highest form of law in a legal system, to which all other laws must conform; in the United States, this refers to the U.S. Constitution.