Choice "A" is correct. Under IFRS, the impairment loss is recognized as the difference between the carrying value ($12,500) and the recoverable amount. The recoverable amount is the greater of the fair value of the assets less cost to sell ($11,200 - $600$10,600) and the asset's value in use (otherwise known as the present value of future cash flows, or $10,950). The carrying value of $12,500 less the recoverable amount of $10,950 equals an impairment loss of $1,550.
Choice "d" is incorrect. This calculation incorrectly subtracts the present value of future cash flows from the fair value.
Choice "c" is incorrect. This choice incorrectly takes the carrying value of $12,500 and subtracts from it the fair value without taking into account the costs to sell.
Choice "b" is incorrect. This choice incorrectly subtracts a recoverable amount based on the lower (rather than the higher) of the two values: fair value less costs to sell versus present value of future cash flows.