The impairment entry reduces both net income in the income statement and total assets in the balance sheet by the amount of the impairment loss.
true or false
ANS | TRUE | |||||||||||||
When the fair value of assets falls below the book value, assets are considered to be impaired | ||||||||||||||
write-off due to an impairment loss is dedited to loss from impairment.Loss from impairment is appearing on the income statement as expenses | ||||||||||||||
So Loss from Impairment reduces net income | ||||||||||||||
As part of the same entry, Credit is made to Assets A/c or provison for Impairment losses which reduces asset Value | ||||||||||||||
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