CFA Practice Question

There are 520 practice questions for this study session.

CFA Practice Question

Under U.S. GAAP, if the fair value of an impaired long-term asset is not readily determinable, it should be shown on the balance sheet at historical cost less accumulated depreciation. True or False?
Correct Answer: False

If the fair value of an impaired asset is not readily determinable, its value should be estimated by discounting expected future net operating cash flows. This is not equal to cost less accumulated depreciation.

User Contributed Comments 3

User Comment
kalps Ok, if FV of LT asset is not readily determinable then it should shown on the balance sheet as the discounted expected future net operating cash flows
ehc0791 If you come up some number, that means you determine the value which is conflic with "Not dterminable"
cong If the fair value of an impaired long-term asset is not readily determinable, it should be shown on the B/S on a discount basis.
You need to log in first to add your comment.