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In-s [12.5K]
2 years ago
8

In 2020, Dooling Corporation acquired Oxford Inc. for $250 million, of which $50 million was attributed to goodwill. At the end

of 2021, Dooling's accountants derive the following information for a required goodwill impairment test:
Book value of Oxford (including goodwill): $234.5 million
Fair value of Oxford's tangible and intangible assets (excluding goodwill): $209.5 million
Fair value of Oxford (the reporting unit): $260.0 million

Required:
a. Determine the amount, if any, of the goodwill impairment loss that Dooling must recognize on these assets.
b. Determine the proper balance of goodwill in Dooling’s records at the end of 2021
Business
1 answer:
8_murik_8 [283]2 years ago
7 0

Answer:

$9.5m

Explanation:

Requirement 1

As the IAS 36 ( Impairment of assets) Impairment loss needs to be recorded when the recoverable amount of an asset is lower than its carrying value.

Book value of goodwill = $50million

Recoverable amount/Fair value = Fair value of Oxford the reporting unit  - Fair value of Oxford tangible and intangible assets excluding goodwill

Recoverable amount/Fair value = $250m - 209.5m

Recoverable amount/Fair value  = $40.5m

Impairment loss = Recoverable amount/Fair value - Book value

Impairment loss = $40.5m - $50m

Impairment loss = $9.5m

Requirement 2

In 2021, Goodwill will be recorded as $40.5m with an impairment loss of $9.5m

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Answer:

The correct answer is letter "C": informal leader.

Explanation:

Informal leaders are individuals to whom people put their trust on because they provoke a strong influence within a group or because others see that individuals as examples to follow. However, informal leaders are not officially recognized. Most formalized leaders begin naturally being informal leaders until the collective will of subordinates place them in the position of power.

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allochka39001 [22]

Answer:

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