At 31 december 20x3 biaz ltd carries out a review for, Ask an Expert

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At 31 December 20X3, Biaz Ltd carries out a review for impairment of a machine shop, acquired at the beginning of 20X1 for £20000. The useful life of the ma- chine shop was estimated at five years with a zero residual value. The machine shop is depreciated straight-line. Taking into account the impact of technological advances on operating conditions, the recoverable amount of the machine shop is estimated at £6000, with a remaining useful life of two years.

Required: Determine if any impairment loss is to be accounted for at the end of 20X3. What would be the book value of the machine shop at the end of 20X4 (no further impairment during 20X4)?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91719713

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