# ASC 360-10-35: Property, Plant, and Equipment — Overall — 35 Subsequent Measurement Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/360/10/#35-subsequent-measurement) Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective. Tables and mathematical or amendment markup are retained as HTML where Markdown would lose structure. Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:eccf9622585058558ae591b6fc811d22c15ade9e737b5806b830e1348430018d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 360-10-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/360/10/#35-subsequent-measurement) SEC content: no ##### [360-10-35-1](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-1) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:621089530b701cb1d626a54d9ccf1c551673b1b24526536be1f38fb19eb95943 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subsection addresses depreciation of property, plant, and equipment and the post acquisition accounting for an interest in the residual value of a leased asset. #### Depreciation ##### [360-10-35-2](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-2) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:85dce47de2b56dec05efa10da37c67c329fde37adb896779db0d5f8cb0795454 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This guidance addresses the concept of depreciation accounting and the various factors to consider in selecting the related periods and methods to be used in such accounting. ##### [360-10-35-3](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-3) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:d12b487e4b4be130a55cbf9ca668c84107d9fae0ba08356eceed97d31cd4393b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Depreciation expense in financial statements for an asset shall be determined based on the asset's useful life. ##### [360-10-35-4](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-4) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:aff2f9499b4be3ea6ca84b2a765724282e812cf5c38b883a1e93583c1b769f3f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The cost of a productive facility is one of the costs of the services it renders during its useful economic life. Generally accepted accounting principles (GAAP) require that this cost be spread over the expected useful life of the facility in such a way as to allocate it as equitably as possible to the periods during which services are obtained from the use of the facility. This procedure is known as depreciation accounting, a system of accounting which aims to distribute the cost or other basic value of tangible capital assets, less salvage (if any), over the estimated useful life of the unit (which may be a group of assets) in a systematic and rational manner. It is a process of allocation, not of valuation. ##### [360-10-35-5](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-5) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:cc1d115922e6791bd5f1da3e7a9cc7941a21ffacd771ebda0332fcdb15471d39 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [360-10-35-20](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-20) for a discussion of depreciation of a new cost basis after recognition of an [impairment](https://asc.understandingaccounting.org/glossary/i/#impairment "Impairment is the condition that exists when the carrying amount of a long-lived asset (asset group) exceeds its fair value.") loss. ##### [360-10-35-6](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-6) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:bd2e110cd5ba604ff48ecffbdd652032eae7f8d2108429a4a8f468924b20eaab Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [360-10-35-43](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-43) for a discussion of cessation of depreciation on long-lived assets classified as held for sale. ##### [360-10-35-7](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-7) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:625ca0072f399421765c27f58c1c2c99272212c9669aa91c7eb26e3bfbb97a2a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The declining-balance method is an example of one of the methods that meet the requirements of being systematic and rational. If the expected productivity of the asset or ability of the asset to generate revenue is relatively greater during the earlier years of its life, or maintenance charges tend to increase during later years, the declining-balance method may provide the most satisfactory allocation of cost. That conclusion also applies to other methods, including the sum-of-the-years'-digits method, that produce substantially similar results. ##### [360-10-35-8](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-8) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:2469cae14fac8c3545077f797856d321b341b6934efd29a29e82518484928391 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In practice, experience regarding loss or damage to depreciable assets is in some cases one of the factors considered in estimating the depreciable lives of a group of depreciable assets, along with such other factors as wear and tear, obsolescence, and maintenance and replacement policies. ##### [360-10-35-9](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-9) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:60453f3399a666008e6a0358903c09c615111e99cfca439b0e88f0e31eacb1f5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the number of years specified by the Accelerated Cost Recovery System of the Internal Revenue Service (IRS) for recovery deductions for an asset does not fall within a reasonable range of the asset's useful life, the recovery deductions shall not be used as depreciation expense for financial reporting. ##### [360-10-35-10](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-10) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:919e72d0b0f7bb7f43d88115bd21e210709a74b425c91c409addbb72eef127f3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Annuity methods of depreciation are not acceptable for entities in general. ##### [360-10-35-11](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-11) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:2e625dc2abd1a0a8c221dc687e677301ae941a149ae5b0a9ab5a8ad7d5602a72 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraphs [250-10-45-17 through 45-20](https://asc.understandingaccounting.org/asc/250/10/#250-10-45-17) for guidance on the accounting and presentation of changes in methods of depreciation. ##### [360-10-35-12](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-12) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:8d91c32e2621e206d98ac4b939930537df6fa1aad6dace5b0e7438b37304f9ff Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph not used](https://asc.understandingaccounting.org/updates/page-1833002/). #### Adjusting the Residual Value in Leased Assets by a Third Party ##### [360-10-35-13](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-13) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:9becdbe6ed7add09e2751d7e9fdec3407a990852afc0fca86d1a25f7ee0182b1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following paragraph provides guidance on how an entity acquiring an interest in the residual value of a leased asset shall account for that asset during the lease term. ##### [360-10-35-14](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-14) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:db96dd386ee4e772bad7313bf4769fb5902a9d5a6f4af052f5d0c79443360cf7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An entity acquiring an interest in the residual value of any leased asset, irrespective of the classification of the related lease by the lessor, shall not recognize increases to the asset's estimated value over the remaining term of the related lease, and the asset shall be reported at no more than its acquisition cost until sale or disposition. If it is subsequently determined that the fair value of the residual value of a leased asset has declined below the carrying amount of the acquired interest and that decline is other than temporary, the asset shall be written down to fair value, and the amount of the write-down shall be recognized as a loss. That fair value becomes the asset's new carrying amount, and the asset shall not be increased for any subsequent increase in its fair value before its sale or disposition. ### Impairment or Disposal of Long-Lived Assets ##### [360-10-35-15](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-15) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:1978446db34e147931806b2ea4d7b1914ff1ea79aa9a4861a09df1bb55f03bef Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. There are unique requirements of accounting for the [impairment](https://asc.understandingaccounting.org/glossary/i/#impairment "Impairment is the condition that exists when the carrying amount of a long-lived asset (asset group) exceeds its fair value.") or disposal of long-lived assets to be held and used or to be disposed of. Although this guidance deals with matters which may lead to the ultimate disposition of assets, it is included in this Subsection because it describes the measurement and classification of assets to be held and used and assets held for disposal before actual disposition and derecognition. See the [Impairment or Disposal of Long-Lived Assets Subsection](https://asc.understandingaccounting.org/asc/360/10/#40-derecognition) of Section 360-10-40 for a discussion of assets or asset groups for which disposition has taken place in an exchange or distribution to owners. #### Long-Lived Assets Classified as Held and Used ##### [360-10-35-16](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-16) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:c997887897a5251c32354e44a0cfc9ff9a7d74a4e19218d9844971b2670bdbba Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This guidance addresses how long-lived assets or asset groups that are intended to be held and used in an entity's business shall be reviewed for impairment. ##### [360-10-35-17](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-17) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:46adbc193dd5463fc9566cef41de6171b7af6f289621ec66887b6e09a514551b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An impairment loss shall be recognized only if the carrying amount of a long-lived asset ([asset group](https://asc.understandingaccounting.org/glossary/a/#asset-group "An asset group is the unit of accounting for a long-lived asset or assets to be held and used, which represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities.")) is not recoverable and exceeds its fair value. The carrying amount of a long-lived asset (asset group) is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset (asset group). That assessment shall be based on the carrying amount of the asset (asset group) at the date it is tested for recoverability, whether in use (see paragraph [360-10-35-33](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-33)) or under development (see paragraph [360-10-35-34](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-34)). An impairment loss shall be measured as the amount by which the carrying amount of a long-lived asset (asset group) exceeds its fair value. ##### [360-10-35-18](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-18) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:03691bcb3ad53145f152de2cf69c78222ed8892b143c6657856b490951a9142a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In applying the provisions of this Subtopic, the carrying amount of the asset being tested for impairment shall include amounts of capitalized asset retirement costs. Estimated future cash flows related to the liability for an asset retirement obligation that has been recognized in the financial statements shall be excluded from both of the following: 1. a  The undiscounted cash flows used to test the asset for recoverability 2. b The discounted cash flows used to measure the asset's fair value. ##### [360-10-35-19](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-19) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:697f682c7180a9f27e3ebe5221128b0624317fb6b57e2f20410950e1645f8253 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the fair value of the asset is based on a quoted market price and that price considers the costs that will be incurred in retiring that asset, the quoted market price shall be increased by the fair value of the asset retirement obligation for purposes of measuring impairment. ##### [360-10-35-20](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-20) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:49beb6af9bf3bbbf11027c8d90b863a9092ae832323eb5bfee8fd48a31fd31e6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If an impairment loss is recognized, the adjusted carrying amount of a long-lived asset shall be its new cost basis. For a depreciable long-lived asset, the new cost basis shall be depreciated (amortized) over the remaining useful life of that asset. Restoration of a previously recognized impairment loss is prohibited. ##### [360-10-35-21](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-21) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:e6f8b04969e90212f77c346ff81de19b5ac7e8103ab2b7c69b3796195c87311d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A long-lived asset (asset group) shall be tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. The following are examples of such events or changes in circumstances: 1. a A significant decrease in the market price of a long-lived asset (asset group) 2. b A significant adverse change in the extent or manner in which a long-lived asset (asset group) is being used or in its physical condition 3. c A significant adverse change in legal factors or in the business climate that could affect the value of a long-lived asset (asset group), including an adverse action or assessment by a regulator 4. d An accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of a long-lived asset (asset group) 5. e A current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset (asset group) 6. f A current expectation that, more likely than not, a long-lived asset (asset group) will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. The term _more likely than not_ refers to a level of likelihood that is more than 50 percent. ##### [360-10-35-22](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-22) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:b827095f6ac43efa29634d5c0cfa7da63ed056ea685e002918c6fa557ce013d9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. When a long-lived asset (asset group) is tested for recoverability, it also may be necessary to review depreciation estimates and method as required by Topic 250 or the amortization period as required by Topic 350. Paragraphs [250-10-45-17 through 45-20](https://asc.understandingaccounting.org/asc/250/10/#250-10-45-17) and [250-10-50-4](https://asc.understandingaccounting.org/asc/250/10/#250-10-50-4) address the accounting for changes in estimates, including changes in the method of depreciation, amortization, and depletion. Paragraphs [350-30-35-1 through 35-5](https://asc.understandingaccounting.org/asc/350/30/#350-30-35-1) address the determination of the useful life of an intangible asset. Any revision to the remaining useful life of a long-lived asset resulting from that review also shall be considered in developing estimates of future cash flows used to test the asset (asset group) for recoverability (see paragraphs [360-10-35-31 through 35-32](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-31) ). However, any change in the accounting method for the asset resulting from that review shall be made only after applying this Subtopic. ##### [360-10-35-23](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-23) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:136b8a5fe2e7daba1b9a5554f2308314b4d231f4634d15c73ef7d848df4dc7e9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For purposes of recognition and measurement of an impairment loss, a long-lived asset or assets shall be grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. However, an impairment loss, if any, that results from applying this Subtopic shall reduce only the carrying amount of a long-lived asset or assets of the group in accordance with paragraph [360-10-35-28](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-28). ##### [360-10-35-24](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-24) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:1a8022f59d61f536960326fab8e23112d569aec9e792f48da79e81061c7c33e1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In limited circumstances, a long-lived asset (for example, a corporate headquarters facility) may not have identifiable cash flows that are largely independent of the cash flows of other assets and liabilities and of other asset groups. In those circumstances, the asset group for that long-lived asset shall include all assets and liabilities of the entity. ##### [360-10-35-25](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-25) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:ccc3bdd6470eba0e729b07fb299a5482ee7816ab5b2c3f858a97814677e2e7ac Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In limited circumstances, an asset group will include all assets and liabilities of the entity. For example, the cost of operating assets such as corporate headquarters or centralized research facilities may be funded by revenue-producing activities at lower levels of the entity. Accordingly, in limited circumstances, the lowest level of identifiable cash flows that are largely independent of other asset groups may be the entity level. See Example 4 (paragraph [360-10-55-35](https://asc.understandingaccounting.org/asc/360/10/#360-10-55-35)). ##### [360-10-35-26](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-26) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:3b7664c089f1acd261f4f753f92d540d0513c58851aff8e84d717f8908239f88 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Goodwill shall be included in an asset group to be tested for impairment under this Subtopic only if the asset group is or includes a reporting unit. Goodwill shall not be included in a lower-level asset group that includes only part of a reporting unit. Estimates of future cash flows used to test that lower-level asset group for recoverability shall not be adjusted for the effect of excluding goodwill from the group. The term _reporting unit_ is defined in Topic 350 as the same level as or one level below an [operating segment](https://asc.understandingaccounting.org/glossary/o/#operating-segment "A component of a public entity. See Section 280-10-50 for additional guidance on the definition of an operating segment."). That Topic requires that goodwill be tested for impairment at the reporting unit level. ##### [360-10-35-27](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-27) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:796cee6a442d985975fe03cec8a89f98e7ddb89e13f7374c57f42b8af383671d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Other than goodwill, the carrying amounts of any assets (such as accounts receivable and inventory) and liabilities (such as accounts payable, long-term debt, and asset retirement obligations) not covered by this Subtopic that are included in an asset group shall be adjusted in accordance with other applicable generally accepted accounting principles (GAAP) before testing the asset group for recoverability. Paragraph [350-20-35-31](https://asc.understandingaccounting.org/asc/350/20/#350-20-35-31) requires that goodwill be tested for impairment only after the carrying amounts of the other assets of the reporting unit, including the long-lived assets covered by this Subtopic, have been tested for impairment under other applicable accounting guidance. ##### [360-10-35-28](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-28) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:b7fa53ec5e28afbdadbb424627c0ad4da6c3698ffedaec2a45c78494ffd4eace Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An impairment loss for an asset group shall reduce only the carrying amounts of a long-lived asset or assets of the group. The loss shall be allocated to the long-lived assets of the group on a pro rata basis using the relative carrying amounts of those assets, except that the loss allocated to an individual long-lived asset of the group shall not reduce the carrying amount of that asset below its fair value whenever that fair value is determinable without undue cost and effort. See Example 1 (paragraph [360-10-55-20](https://asc.understandingaccounting.org/asc/360/10/#360-10-55-20)) for an illustration of this guidance. ##### [360-10-35-29](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-29) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:22c78b86df552e1ab8452b8da871f44be2ef38ab02e3bbb5da5728afc280eb8d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Estimates of future cash flows used to test the recoverability of a long-lived asset (asset group) shall include only the future cash flows (cash inflows less associated cash outflows) that are directly associated with and that are expected to arise as a direct result of the use and eventual disposition of the asset (asset group). Those estimates shall exclude interest charges that will be recognized as an expense when incurred. ##### [360-10-35-30](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-30) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:04b574a306cba1a4a3b3f6b29e40fbfb5d6e5ec7abd2656a337c2208738cf01c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Estimates of future cash flows used to test the recoverability of a long-lived asset (asset group) shall incorporate the entity's own assumptions about its use of the asset (asset group) and shall consider all available evidence. The assumptions used in developing those estimates shall be reasonable in relation to the assumptions used in developing other information used by the entity for comparable periods, such as internal budgets and projections, accruals related to incentive compensation plans, or information communicated to others. However, if alternative courses of action to recover the carrying amount of a long-lived asset (asset group) are under consideration or if a range is estimated for the amount of possible future cash flows associated with the likely course of action, the likelihood of those possible outcomes shall be considered. A probability-weighted approach may be useful in considering the likelihood of those possible outcomes. See Example 2 (paragraph [360-10-55-23](https://asc.understandingaccounting.org/asc/360/10/#360-10-55-23)) for an illustration of this guidance. ##### [360-10-35-31](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-31) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:42ca5f44cc4fa0555c1d92503391d80736e3d5130316aee089ed0694efaa011b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Estimates of future cash flows used to test the recoverability of a long-lived asset (asset group) shall be made for the remaining useful life of the asset (asset group) to the entity. The remaining useful life of an asset group shall be based on the remaining useful life of the primary asset of the group. For purposes of this Subtopic, the primary asset is the principal long-lived tangible asset being depreciated or intangible asset being amortized that is the most significant component asset from which the asset group derives its cash-flow-generating capacity. The primary asset of an asset group therefore cannot be land or an intangible asset not being amortized. ##### [360-10-35-32](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-32) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:fac6cc615387613f353ebff792e94107a9b782f6e1bb154d62cee3e7a5d9c4ac Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Factors that an entity generally shall consider in determining whether a long-lived asset is the primary asset of an asset group include the following: 1. a Whether other assets of the group would have been acquired by the entity without the asset 2. b The level of investment that would be required to replace the asset 3. c The remaining useful life of the asset relative to other assets of the group. If the primary asset is not the asset of the group with the longest remaining useful life, estimates of future cash flows for the group shall assume the sale of the group at the end of the remaining useful life of the primary asset. ##### [360-10-35-33](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-33) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:6d50dda9c41e44748da8a8ae42e7c2bec4bf5d0c449300ddd63ee679dc66fa96 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Estimates of future cash flows used to test the recoverability of a long-lived asset (asset group) that is in use, including a long-lived asset (asset group) for which development is substantially complete, shall be based on the existing service potential of the asset (asset group) at the date it is tested. The service potential of a long-lived asset (asset group) encompasses its remaining useful life, cash-flow-generating capacity, and for tangible assets, physical output capacity. Those estimates shall include cash flows associated with future expenditures necessary to maintain the existing service potential of a long-lived asset (asset group), including those that replace the service potential of component parts of a long-lived asset (for example, the roof of a building) and component assets other than the primary asset of an asset group. Those estimates shall exclude cash flows associated with future capital expenditures that would increase the service potential of a long-lived asset (asset group). ##### [360-10-35-34](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-34) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:3c948525718535b62a3c01c84ee14c941c7805ea91a81cc4c754b4a068db8a6a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Estimates of future cash flows used to test the recoverability of a long-lived asset (asset group) that is under development shall be based on the expected service potential of the asset (group) when development is substantially complete. Those estimates shall include cash flows associated with all future expenditures necessary to develop a long-lived asset (asset group), including interest payments that will be capitalized as part of the cost of the asset (asset group). Subtopic 835-20 requires the capitalization period to end when the asset is substantially complete and ready for its intended use. ##### [360-10-35-35](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-35) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:7976734c51bb3ae28a473a980600e29021dcef00aaab258f5f054a4774ed7551 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If a long-lived asset that is under development is part of an asset group that is in use, estimates of future cash flows used to test the recoverability of that group shall include the cash flows associated with future expenditures necessary to maintain the existing service potential of the group (see paragraph [360-10-35-33](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-33)) as well as the cash flows associated with all future expenditures necessary to substantially complete the asset that is under development (see the preceding paragraph). See Example 3 (paragraph [360-10-55-33](https://asc.understandingaccounting.org/asc/360/10/#360-10-55-33)). See also paragraphs [360-10-55-7 through 55-18](https://asc.understandingaccounting.org/asc/360/10/#360-10-55-7) for considerations of site restoration and environmental exit costs. ##### [360-10-35-36](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-36) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:6db8ac560bef5e2015b169bf712fd4017061ea8640af25fa7081c28eb383fed9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For long-lived assets (asset groups) that have uncertainties both in timing and amount, an expected present value technique will often be the appropriate technique with which to estimate fair value. #### Long-Lived Assets Classified as Held for Sale ##### [360-10-35-37](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-37) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:d112aea18e04cfa3c75cdb0ec7d8696e7b9159a23860f2082ce6dea3ccca0cf1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This guidance addresses the accounting for expected disposal losses for long-lived assets and asset groups that are classified as held for sale but have not yet been sold. See paragraphs [360-10-45-9 through 45-11](https://asc.understandingaccounting.org/asc/360/10/#360-10-45-9) for the initial criteria to be met for classification as held for sale. ##### [360-10-35-38](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-38) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:71d119fbdd1b98a715a1a8a0d1f8a8b1372687bdf051d0342c9e888d3b02b9a3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Costs to sell are the incremental direct costs to transact a sale, that is, the costs that result directly from and are essential to a sale transaction and that would not have been incurred by the entity had the decision to sell not been made. Those costs include broker commissions, legal and title transfer fees, and closing costs that must be incurred before legal title can be transferred. Those costs exclude expected future losses associated with the operations of a long-lived asset ([disposal group](https://asc.understandingaccounting.org/glossary/d/#disposal-group "A disposal group for a long-lived asset or assets to be disposed of by sale or otherwise represents assets to be disposed of together as a group in a single transaction and liabilities directly associated with those assets that will be transferred in the transaction. A disposal group may include a discontinued operation along with other assets and liabilities that are not part of the discontinued operation.")) while it is classified as held for sale. Expected future operating losses that marketplace participants would not similarly consider in their estimates of the fair value less cost to sell of a long-lived asset (disposal group) classified as held for sale shall not be indirectly recognized as part of an expected loss on the sale by reducing the carrying amount of the asset (disposal group) to an amount less than its current fair value less cost to sell. If the sale is expected to occur beyond one year as permitted in limited situations by paragraph [360-10-45-11](https://asc.understandingaccounting.org/asc/360/10/#360-10-45-11), the cost to sell shall be discounted. ##### [360-10-35-39](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-39) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:24c72590724a336572e977b834d6fc233028e8aaf1062c2b7c21ce143aa5e450 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The carrying amounts of any assets that are not covered by this Subtopic, including goodwill, that are included in a disposal group classified as held for sale shall be adjusted in accordance with other applicable GAAP prior to measuring the fair value less cost to sell of the disposal group. Paragraphs [350-20-40-1 through 40-7](https://asc.understandingaccounting.org/asc/350/20/#350-20-40-1) provide guidance for allocating goodwill to a lower-level asset group to be disposed of that is part of a reporting unit and that constitutes a business. Goodwill is not included in a lower-level asset group to be disposed of that is part of a reporting unit if it does not constitute a business. ##### [360-10-35-40](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-40) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:693d43f897b246fba9dcf46566e74a807a197070e1a4810bc9ba64a62f7a0c7f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A loss shall be recognized for any initial or subsequent write-down to fair value less cost to sell. A gain shall be recognized for any subsequent increase in fair value less cost to sell, but not in excess of the cumulative loss previously recognized (for a write-down to fair value less cost to sell). The loss or gain shall adjust only the carrying amount of a long-lived asset, whether classified as held for sale individually or as part of a disposal group. ##### [360-10-35-41](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-41) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:d15df5385d299ceb29bbc3002c31cbd291ac83f86bf4ccf1b85b4fd83d075749 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraphs [310-20-35-12D](https://asc.understandingaccounting.org/asc/310/20/#310-20-35-12D) and [310-20-40-12](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-12) for guidance related to determination of cost basis for foreclosed assets under Subtopic 310-20 and the measurement of cumulative losses previously recognized under paragraph [360-10-35-40](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-40). ##### [360-10-35-42](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-42) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:567c1d89b6942c99979dbd00d1e676344733b347ca9a0b8a82e170607afb9150 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraphs [830-30-45-13 through 45-15](https://asc.understandingaccounting.org/asc/830/30/#830-30-45-13) for guidance regarding the application of Topic 830 to an investment being evaluated for impairment that will be disposed of. ##### [360-10-35-43](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-43) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:55bad1167547623564eb0c4a99c2fac9e8d3f00518f9fb2cea2422974bfc3ab0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A long-lived asset (disposal group) classified as held for sale shall be measured at the lower of its carrying amount or fair value less cost to sell. If the asset (disposal group) is newly acquired, the carrying amount of the asset (disposal group) shall be established based on its fair value less cost to sell at the acquisition date. A long-lived asset shall not be depreciated (amortized) while it is classified as held for sale. Interest and other expenses attributable to the liabilities of a disposal group classified as held for sale shall continue to be accrued. ##### [360-10-35-44](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-44) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:1eab0f33f298d32336723e4e6c5d3f6e74d3654eaa4786e6e3da21276be385fd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If circumstances arise that previously were considered unlikely and, as a result, an entity decides not to sell a long-lived asset (disposal group) previously classified as held for sale, the asset (disposal group) shall be reclassified as held and used. A long-lived asset that is reclassified shall be measured individually at the lower of the following: 1. a Its carrying amount before the asset (disposal group) was classified as held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the asset (disposal group) been continuously classified as held and used 2. b Its fair value at the date of the subsequent decision not to sell. ##### [360-10-35-45](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-45) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:0cdc32c96c1be8fd8b0bc8084b369ed104968b9e81f3d20a217cebc3bc26e1a0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If an entity removes an individual asset or liability from a disposal group previously classified as held for sale, the remaining assets and liabilities of the disposal group to be sold shall continue to be measured as a group only if the criteria in paragraph [360-10-45-9](https://asc.understandingaccounting.org/asc/360/10/#360-10-45-9) are met. Otherwise, the remaining long-lived assets of the group shall be measured individually at the lower of their carrying amounts or fair values less cost to sell at that date. #### Long-Lived Assets to Be Disposed of Other than by Sale ##### [360-10-35-46](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-46) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:5e628bd5a9832d86f0c004a0e9f1437566b683c5a764e1721bd5c4dcc0022d37 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This guidance addresses the accounting for impairment of long-lived assets and asset groups that are intended to be disposed of by abandonment. ##### [360-10-35-47](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-47) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:6d48e36da2fd7fd8fcbf60df49c375c967ae94bdf2aeb9a97bfb8d8aa54b46c8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For purposes of this Subtopic, a long-lived asset to be abandoned is disposed of when it ceases to be used. If an entity commits to a plan to abandon a long-lived asset before the end of its previously estimated useful life, depreciation estimates shall be revised in accordance with paragraphs [250-10-45-17 through 45-20](https://asc.understandingaccounting.org/asc/250/10/#250-10-45-17) and [250-10-50-4](https://asc.understandingaccounting.org/asc/250/10/#250-10-50-4) to reflect the use of the asset over its shortened useful life (see paragraph [360-10-35-22](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-22)). ##### [360-10-35-48](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-48) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:cbe89b43785d2deed4fbec0625e40e8547b90b8771a5cb5b6dcac8c091f93074 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Because the continued use of a long-lived asset demonstrates the presence of service potential, only in unusual situations would the fair value of a long-lived asset to be abandoned be zero while it is being used. When a long-lived asset ceases to be used, the carrying amount of the asset should equal its salvage value, if any. The salvage value of the asset shall not be reduced to an amount less than zero. ##### [360-10-35-49](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-49) Pending content: no Source downloaded (UTC): 2026-09-10T00:05:55.674Z to 2026-09-10T00:05:55.674Z Record version: sha256:a6df9f99aced0a0d3d8f71f0299e81d4270fa67b755fc189f1cdaa3c07e48e45 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A long-lived asset that has been temporarily idled shall not be accounted for as if abandoned.