- CFA Exams
- CFA Level I Exam
- Study Session 8. Financial Reporting and Analysis (3)
- Reading 26. Long-lived Assets
- Subject 5. Impairment of Assets
CFA Practice Question
Which of the following would be a circumstance that would lead to the impairment of a long-term asset?
A. Any change in the legal or business environment
B. Significant decreases in the market value of the asset
C. Current period operating or cash flows that are smaller than in previous periods
Explanation: Significant decreases in the market value of the asset will lead to an impairment of that asset, which must be written down.
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