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Project Essay on Impairment Loss for Asset

Added on - 04 Jun 2020

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Corporate Accountingand Reporting
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1PART A...........................................................................................................................................1Measurement and recognition of impairment loss.................................................................1PART B............................................................................................................................................3CONCLUSION................................................................................................................................4REFERENCES................................................................................................................................5..........................................................................................................................................................5
INTRODUCTIONCorporate accounting is the stem of accounting that deals with the companies financialstatements and formulation of final accounts. Such as cash flow statements analysis andinterpretation of results and certain specific activitiesare undertakenwhich are associated withamalgamation and preparation of consolidatedstatements (Zadek, Evans and Pruzan, 2013). Theproject essay is about entries related with impairment loss for an assets and other property..PART AMeasurement and recognition of impairment lossIn corporate accounting, it is the drop-offinvalueof possessionnetamountthat increasethe future unrevealed cash flows.It occurs at the time when a company sells or abandons anyproperty or assets that isofno use for the company any more. An impairment loss can beidentified gradually in income statements, unless the assetsarecarried at measurable amount inrelation to the another standards. In each organization, a situation comes when the present valueof assets gets reduced.So,the business need to test for impairment(Yallapragada, Roe andToma, 2012). It is used to record and compact assets for the revaluation. At the time assets arerevalued,market value gets fluctuated,which is periodical. On an annual basis the goodwill ofthe companymustberevalued.In case of Individual assets there are some requirement whichare neededto be followed by the company. Such as:When the redeemable value of an assets is less than the carried amount, the carrying costmust be decreased to the redeemable amount.The difference amount among the decrease form the past carry amount to the redeemableamount is considered as impairment loss.Asset was revalued to an incresed amount in accordance with AASB.If a company has faced a impairment losses it should bedebited toloss on alterationandcreditedto the assets. The major impact seen over the income statements is that decrease inincome amountbutthere is also a cut down in total assets in the balance sheet.Impairment measurement:In every organization assets are considered to be the most crucial element,in thisif theassets suffers a loss in their value than it is necessary to calculate the total damage which is done1
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