Unique Gifts, Inc., a retailer of specialty items, was especially proud of its original handmade product lines. One product had a tradename with a book value of $290,000. On December 31, 20X5, the tradename was determined to have an impairment loss, thus reducing its value to $200,000. In 20X8, Unique Gifts, Inc. determined the fair value of the tradename had gone back up to $290,000. How much should Unique Gifts, Inc. report the tradename on its 20X8 Balance Sheet?
A $90,000
B $290,000
C $200,000
D None of the above
Answer is option C
C. $200,000
In the balance sheet, the assets are recorded at carrying value, however if there is any reduction due to impairment loss than the reduced carrying value should be recorded.
Unique Gifts, Inc., a retailer of specialty items, was especially proud of its original handmade product...
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