At the end of its 2009 fiscal year, a triggering event caused Janero Corporation to perform an impairment test for one of its manufacturing facilities. The following information is available: The manufacturing facility is:
A)Impaired because its book value exceeds expected future cash flows.
B)Not impaired because its book value exceeds undiscounted future cash flows.
C)Not impaired because it continues to produce revenue.
D)Impaired because its book value exceeds fair value.

Question

Quizplus · Accepted Answer

The facility is impaired because its book value exceeds the expected future cash flows, indicating that the asset's carrying amount is not recoverable.

At the End of Its 2009 Fiscal Year, a Triggering