CERTYNEX IFRS ACADEMY

At 31 December 20X1, Lornac Ltd holds a bottling line with a carrying amount of EUR 1,000,000. Its fair value less costs of disposal is EUR 850,000 and its value in use EUR 920,000. What is the recoverable amount of the line?

EUR 850,000, since the more prudent of the two amounts must be used.

EUR 1,000,000, since the carrying amount is the reference as long as the line is in use.

EUR 920,000, the higher of fair value less costs of disposal and value in use.

EUR 80,000, the difference between carrying amount and value in use.