repeat e12 13 but now assume that dayton prepares financial statements in accordance 4373598

Repeat E12-13, but now assume that Dayton prepares financial statements in accordance with ASPE, and that the recoverable amount under ASPE (undiscounted future cash flows) is calculated to be $500,000 at the end of 2015. In exercise At the end of 2014, Dayton Corporation owns a licence with a remaining life of 10 years and a carrying amount of $530,000. Dayton expects undiscounted future cash flows from this licence to total $535,000. The licence’s fair value is $425,000 and disposal costs are estimated to be nil. The licence’s discounted cash flows (that is, value in use) are estimated to be $475,000. Dayton prepares financial statements in accordance with IFRS. Instructions (a) Determine if the licence is impaired at the end of 2014 and prepare any related entries that are necessary. (b) Assume the recoverable amount is calculated to be $450,000 at the end of 2015. Determine if the licence is impaired at the end of 2015 and prepare any related entries that are necessary. (c) Explain how the answer to part (b) would change if the licence’s fair value is $500,000 at the end of 2015. View Solution:
Repeat E12 13 but now assume that Dayton prepares financial statements

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