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      Question

      As per the accounting standards, the impairment loss on

      a revalued asset is recognised in _______
      A Profit & loss Correct Answer Incorrect Answer
      B Balance sheet Correct Answer Incorrect Answer
      C Exceptional income Correct Answer Incorrect Answer
      D Other comprehensive income Correct Answer Incorrect Answer
      E None of the above Correct Answer Incorrect Answer

      Solution

      An impairment loss on a non-revalued asset is recognised in profit or loss. However, an impairment loss on a revalued asset is recognised in other comprehensive income to the extent that the impairment loss does not exceed the amount in the revaluation surplus for that same asset. Such an impairment loss on a revalued asset reduces the revaluation surplus for that asset (AS 36).

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