Devo Co.has an indefinite-life intangible asset with a carrying value of $782,000.The undiscounted cash flows expected to be realized from that asset total $827,000; the discounted cash flows are $574,000; and the fair value of the asset has been determined to be $646,000.What is the new carrying value of the asset after impairment loss has been recorded?
A)$827,000
B)$646,000
C)$574,000
D)$136,000

Question

Quizplus · Accepted Answer

The impairment loss should be recorded as the difference between the carrying amount ( $782,000) and the fair value ( $646,000) which is $136,000. Therefore, the new carrying value of the asset will be $646,000.

Devo Cohas an Indefinite-Life Intangible Asset with a Carrying Value of of $782,000.The