Impairment

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What is 'Impairment'

Impairment is reduction in a company's stated capital.

2. The total capital that is less than the par value of the company's capital stock.

BREAKING DOWN 'Impairment'

1. This is usually reduced because of poorly estimated losses or gains.

2. Impairment can be used in many contexts. Whatever the situation, impairment is bad for the company.

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RELATED FAQS
  1. How is impairment loss calculated?

    Learn how companies re-evaluate their assets and compare them against book values to recognize impairment and why this strategy ... Read Answer >>
  2. How do businesses determine if an asset may be impaired?

    Find out how a business should determine if an asset may be impaired in accordance with the generally accepted accounting ... Read Answer >>
  3. How do accountants record impaired assets?

    Learn why accountants need to identify and record impaired assets, how impairments are measured and how they impact financial ... Read Answer >>
  4. How are impaired assets treated under U.S. accounting rules?

    Learn how to identify, test and measure impaired assets under the generally accepted accounting principles, Statement 144 ... Read Answer >>
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    Understand how a fixed asset becomes impaired. Learn the accounting practices of impairing a fixed asset, and how it's recognized ... Read Answer >>
  6. How do you write off impaired assets from the financial statement?

    Learn what an impaired asset is and how it effects a company's financial statements. Understand how an accountant writes ... Read Answer >>
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