Question
An asset was impaired two years ago, reducing its carrying amount to $140,000. Since then, it has been depreciated at $14,000 per year, with no further impairment recognized in the interim. At the current reporting date, the recoverable amount is reassessed at $200,000. Had the original impairment never been recognized, the asset's carrying amount today (net of ordinary depreciation) would have been $180,000.
Required: determine the amount of the impairment reversal recognized.
Statements in this challenge
- Impairment ReversalNumeric Answer
Scoring
- 40% Account naming / line matching
- 40% Amount correctness
- 20% Structure / section placement
How to approach this
IAS 1 — Presentation of Financial Statements
A composite challenge links several statements built from one set of data, so figures flow between them: profit reaches retained earnings, and the closing balances feed the position statement. Complete them in the order the statements depend on each other rather than the order of the tabs.
Common mistakes
- Preparing each statement independently, so the linking figures disagree.
- Carrying a figure forward before finishing the adjustments that change it.
- Reworking a linked figure in one statement without updating it in the others.
Further readingIAS 1: what goes where in a full set of statements