Show the impact of the impairment on january

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Reference no: EM132692669

A company runs a unit that suffers a massive drop in income due to the failure of its technology on 1 January 2008. The following carrying values were recorded in the books immediately prior to the impairment:

Goodwill 20

Technology 5

Brands 10

Land 50

Buildings 30

Other Net Assets 40

The recoverable value of the unit is estimated at $85 million. The technology is worthless, following its complete failure. The other net assets include inventory, receivables and payables. It is considered that the book value of other net assets is a reasonable representation of its net realizable value.

Required:

Problem 1: Show the impact of the impairment on 1 January.

Reference no: EM132692669

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