136B Notes 1_13_11

136B Notes 1_13_11 - 136B 1/13/11 Notes Impairments 1)...

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Impairments 1) Specifically Identifiable Intangibles with Definite Lives *Test for impairments when indicated by circumstances. Step 1: Screening/Recoverability Test: >Compare CV of intangible to est. future undiscounted cash flows * If CV > future cash flows, go to step 2 Step 2: Compute impairment loss= CV of intangible - FMV of intangible J/E: Impairment Loss xx Accum Amort. xx (or intangible asset) 2) Specifically identifiable intangibles with Indefinite Lives *Test annually for impairment *If CV of intangible > FMV of intangible, record impairment loss for the difference. 3) Goodwill *Test for impairment at reporting entity level *Test annually Step 1: Compare CV of entity (including GW) to the FMV of the entity (including GW) >If the CV of the entity > FMV of the entity, go to step 2 and compute the impairment loss on GW Step 2: Impairment loss = Cvof GW - FMV (implied val) of GW *FMV (implied val) of GW = FMV entity - FMV entity's NIA (incl. GW) (excl. GW) *NIA= net identifiable
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This note was uploaded on 02/22/2012 for the course ACCT 1320 taught by Professor Staff during the Spring '11 term at Texas State.

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136B Notes 1_13_11 - 136B 1/13/11 Notes Impairments 1)...

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