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If an impairment loss is recognized for an intangible asset with a finite life, which of the following occurs? (Select all that apply.)
Multiple select question.
A recovery can be recognized up to the initial amount of the impairment
The written-down book value is the new cost basis for future amortization.
Later recovery of the impairment is prohibited.
Future impairment losses are prohibited.

Sagot :

Gauravsingh23VTidn

The written down book value is the new cost basis for future amortization and Later recovery of the impairment is prohibited. Hence, option B and C are correct.

What is written down book value?

Other names for written-down value include book value and net book value. It is calculated by subtracting accrued depreciation or amortization from the asset's original value. From an accounting perspective, the asset's written-down value corresponds to its present value.

This method reduces the asset's book value annually through depreciation, which is applied to the asset's book value. For instance, the initial year depreciation of an asset with a cost of Rs. 1,000,000 and a 10% depreciation rate will be Rs. 10,000 (or 10% of Rs.

Thus, option B and C are correct.

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