Question

A division of an entity has the following balances in its financial statements: Goodwill £700,000, Plant £950,000, Building £2,300,000, Intangibles £800,000, Other net assets £430,000. Following a period of losses, the recoverable amount of the division is deemed to be £4 million. A recent valuation of the building showed that the building has a market value of £2.5 million. The other net assets are at their recoverable amount. The entity uses the cost model for valuing building and plant. To the nearest thousand, what is the balance on plant following the impairment review? A £862,000 B £837,000 C £689,000 D £261,000

          A division of an entity has the following balances in its financial statements: Goodwill £700,000, Plant £950,000, Building £2,300,000, Intangibles £800,000, Other net assets £430,000. Following a period of losses, the recoverable amount of the division is deemed to be £4 million. A recent valuation of the building showed that the building has a market value of £2.5 million. The other net assets are at their recoverable amount. The entity uses the cost model for valuing building and plant.

To the nearest thousand, what is the balance on plant following the impairment review?

A £862,000
B £837,000
C £689,000
D £261,000

Added by Deborah M.

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