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1. Moneo Co. purchased equipment that was installed and ready for use at the beginning of January 2025 for a total cost of $1,250,000. The salvage value was estimated at $200,000. The machinery is depreciated over five years using the straight-line method. At December 31, 2027, the undiscounted expected future net cash flows were $500,000 and the discounted expected net cash flows were $450,000. Instructions 1. Prepare the journal entry to record the impairment loss (if any) at12/31/2027. 2. Assume that Moneo did not use the asset in 2028 and listed it for sale. At 12/31/28, the ass had a fair value of $500,000 and a disposal cost of $10,000. Prepare any journal entry need at that date with regard to the asset.

1. Moneo Co. purchased equipment that was installed and ready for use at the beginning of January 2025 for a total cost of $1,250,000. The salvage value was estimated at $200,000. The machinery is depreciated over five years using the straight-line method. At December 31, 2027, the undiscounted expected future net cash flows were $500,000 and the discounted expected net cash flows were $450,000. Instructions 1. Prepare the journal entry to record the impairment loss (if any) at12/31/2027. 2. Assume that Moneo did not use the asset in 2028 and listed it for sale. At 12/31/28, the ass had a fair value of $500,000 and a disposal cost of $10,000. Prepare any journal entry need at that date with regard to the asset.

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter11: Depreciation, Depletion, Impairment, And Disposal
Section: Chapter Questions
Problem 14P: Hunter Company purchased a light truck on January 2, 2019 for 18,000. The truck, which will be used...
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1. Moneo Co. purchased equipment that was installed and ready for use at the beginning of January 2025 for a total cost of $1,250,000. The salvage value was estimated at $200,000. The machinery is depreciated over five years using the straight-line method. At December 31, 2027, the undiscounted expected future net cash flows were $500,000 and the discounted expected net cash flows were $450,000. Instructions 1. Prepare the journal entry to record the impairment loss (if any) at12/31/2027. 2. Assume that Moneo did not use the asset in 2028 and listed it for sale. At 12/31/28, the asse had a fair value of $500,000 and a disposal cost of $10,000. Prepare any journal entry needed at that date with regard to the asset. erb ed
Transcribed Image Text:1. Moneo Co. purchased equipment that was installed and ready for use at the beginning of January 2025 for a total cost of $1,250,000. The salvage value was estimated at $200,000. The machinery is depreciated over five years using the straight-line method. At December 31, 2027, the undiscounted expected future net cash flows were $500,000 and the discounted expected net cash flows were $450,000. Instructions 1. Prepare the journal entry to record the impairment loss (if any) at12/31/2027. 2. Assume that Moneo did not use the asset in 2028 and listed it for sale. At 12/31/28, the asse had a fair value of $500,000 and a disposal cost of $10,000. Prepare any journal entry needed at that date with regard to the asset. erb ed
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