In testing for impairment of an operational asset,an impairment loss is required if the:
A)Asset's book value exceeds the present value of its expected future cash flows.
B)Expected future cash flows exceeds the asset's book value.
C)Present value of expected future cash flows exceeds its carrying value.
D)Asset's book value exceeds the expected future cash flows.

Question

Quizplus · Accepted Answer

An impairment loss is recognized when the asset's book value exceeds the expected future cash flows, indicating that the asset is not recoverable.

In Testing for Impairment of an Operational Asset,an Impairment Loss