IFRS for SMEs) IFRS for SMEs Property and Impairment

Question 1

How should property, plant and equipment be initially measured under IFRS for SMEs?

Accepted Answer

At cost, including purchase price, directly attributable costs, and estimated dismantling costs

Answer

At fair value determined by an independent appraiser

Answer

At the lower of cost and net realizable value

Answer

At replacement cost

Question 2

What subsequent measurement model is available for PPE under IFRS for SMEs?

Accepted Answer

Cost model only (cost less accumulated depreciation and impairment)

Answer

Revaluation model only

Answer

Either cost or revaluation model

Answer

Fair value through profit or loss

Question 3

How should investment property be measured under IFRS for SMEs?

Accepted Answer

At fair value through profit or loss if fair value can be measured without undue cost; otherwise at cost model

Answer

Always at historical cost

Answer

Always at fair value regardless of cost to determine

Answer

At the lower of cost and fair value

Question 4

When should an entity recognize an impairment loss under IFRS for SMEs?

Accepted Answer

When the carrying amount of an asset exceeds its recoverable amount

Answer

Only when the asset is physically damaged

Answer

At each year-end regardless of indicators

Answer

Only when the asset is sold at a loss

Question 5

How is the recoverable amount of an asset determined under IFRS for SMEs?

Accepted Answer

The higher of fair value less costs to sell and value in use

Answer

The lower of cost and net realizable value

Answer

The average of book value and market value

Answer

The original purchase price less depreciation

Question 6

Can impairment losses be reversed under IFRS for SMEs?

Accepted Answer

Yes, for assets other than goodwill, if the reasons for impairment no longer exist

Answer

No, impairment losses are never reversible

Answer

Only for inventory items

Answer

Only with approval from the tax authority