CFA Practice Question

There are 334 practice questions for this study session.

CFA Practice Question

Regarding impairment, which statement(s) is (are) true?

I. The equity method requires the goodwill to be separately tested for impairment.
II. IFRS allows the reversal of impairment losses when the fair value later increases and there are some objective evidences.
III. Under U.S. GAAP, the impairment loss is recognized in the other comprehensive income of the stockholders' equity section.
Correct Answer: None of them

I. The entire carrying amount of the investment is tested for impairment because goodwill is not separately recognized.
II. The reversal is prohibited under both IFRS and U.S. GAAP.
III. It is recognized directly on the income statement.

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