💼 Pre-MBA Exam Prep

An impairment loss is recorded when:

A An asset market value increases
B An asset carrying amount exceeds its recoverable amount (fair value less costs to sell or value in use)
C Depreciation is complete
D the asset is sold

✓ Correct Answer: Option B

Impairment: when carrying value > recoverable amount, write down to recoverable amount. For goodwill: annual impairment test (ASC 350). For long-lived assets: triggered by indicators.

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