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Ethics Case 11-11 - Asset mischief - LO8 Requirement 1Healthy smell Food partnership acquired equipment for 42 million in 2007 for role in the manufacture of a new line of bon vivant frozen foods . The equipment was estimated to have a useful life of 10 years with nil residual terminal value . later on two years , in 2009 , it has become apparent that the summation impart only be used till 2011 and will be retired at nil salvage value . In addition , there is impairment in its carrying value presently in 2009 and it must be written down by 12 ,900The accounting preaching in such an causa has been discussed in an article by Randall W . Leucke and David T . merging , entitled Asset Impairment and disposal : New business relationship Guidance for long-lived Assets (Leucke and Meeting , 2002 .

The article explores the manner in which the accounting profession seeks to establish a single impersonate for all long-lived assetsRequirement 2The source cited above seeks to explain the treatment once an asset suffers impairment in its carrying value . It recommends that an impairment loss , if any , to be recognized shall be calculated as the amount by which the carrying amount of the asset (asset pigeonholing ) exceeds its fair value at the balance sheet get wind FASB issued Statement no 144 , Accounting for the Impairment or Disposal of Long-Lived Assets (Financial Accounting Standards Board [FASB] , August 2001 , carve up 33 . Thus Healthy Life Food Company should recognize the amount with which the asset value needs to be adjusted (i...If you want to get a full essay, outrank it on our website: Orderessay

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