Impairment write downs company, balance, question, increase, impaired

manchester88

Impairent write downs of long lived assets owned by a company will most likely result in an increase for that company in

A. Debt to equity ratio, but not the total asset turnover
B. The total asset turnover but not the debt to equity ratio
C. Both the debt to equity ratio and total asset turnover

Answer: C

My question is, when you realize a long lived asset is impaired, where on the balance sheet is the reduction done for shareholders equity?

Finalnub

dtrynoski Wrote:
-------------------------------------------------------

>
> My question is, when you realize a long lived
> asset is impaired, where on the balance sheet is
> the reduction done for shareholders equity?

net income, is part of retained earnings, which is included in equity my friend in this country

trogulj

I think the writedown is a loss which reduces the net income, thus, shareholder equity