What is impairment

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Problem - Meow Plc has two investments. Cine, an investment in listed sharesr is available for sale as a ?nancial asset. The current market value is £405,000 but the shares were bought for £675,000. The other is an investment in a three year bond with an amorljsed cost of £450,000 with a stated and effective interest rate of 7% [current market rates are 10%]. Alter have years Meow Plc is not expecting to reoeive the last year's interest and expects to receive only 2.03 of the principal. What is impairment? What impairment should be recorded in the accounts of Meow Plc for the listed shares and the three year bond?

Reference no: EM133014500

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