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How goodwill will be tested for impairment

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Reference no: EM132557807

On September 1, 2020, Humble Corporation acquired Roots Media for a cash payment of $ 859,100. At the time of purchase, Roots' statement of financial position showed assets of $ 899,600, liabilities of $ 462,300, and owner's equity of $ 437,300. The fair value of Roots' assets is estimated to be $ 1,163,900.

Instructions

Question a) Assuming that Humble Corporation is a private entity, explain how goodwill will be tested for impairment.

Question b) If the unit's carrying amount (including goodwill) is $ 3,617,400 and its fair value is $ 3,553,200, what is the impairment loss, if any, under ASPE?

Reference no: EM132557807

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