In 2010, TallyHo Farms acquired production machinery at a cost of £410,000. In 2013 when accumulated depreciation was £160,000, Banbung reported an impairment loss of £75,000. Now, in 2017 the machinery has a book value of £140,000. The recoverable amount of the machinery is £235,000. and its value in use is £210,000. During impairment testing, Bambung recognized the possibility of a reversal of the previous impairment loss. What amount, if any, should Bambung recognize as a reversal of impairment loss?
A. £95,000
B. £75,000
C. £40,000
D. £25,000
Answer:B
In 2010, TallyHo Farms acquired production machinery at a cost of £410,000. In 2013 when accumulated depreciation was £160,000, Banbung reported an impairment loss of £75,000. Now, in 2017 the machinery has a book value of £140,000. The recoverable amount of the machinery is £235,000. and its value in use is £210,000. During impairment testing, Bambung recognized the possibility of a reversal of the previous impairment loss. What amount, if any, should Bambung recognize as a reversal of impairment loss?
A. £95,000 B. £75,000 C. £40,000 D. £25,000