Impaired asset

An impaired asset is one that has a book value less than its market value. In this situation, the book value should be reduced to the market value, which creates a loss in the amount of the difference.  Fixed assets and goodwill are the assets most commonly experiencing impairment write downs. Impairment testing is to be conducted at regular intervals, so a business could experience a series of impairment charges against a single asset.

Related Courses

Fixed Asset Accounting 
GAAP Guidebook