Determine the impairment loss and suggest journal entries.
Case: Impairment
Atlantic Shipping and Transportation Ltd divides its operations into four kinds, and its headquarters in Hong Kong is not allocated to the four kinds of operations with a carrying amount of $2 billion.
Atlantic Shipping is reviewing the impairment of each operation due to the keen competition in the shipping and transportation industries. It considers that each operation is a cash generating unit. The carrying amount of each operation and its estimated value in use are set out as follows (in $million):
| Shipping Operation | Terminal Operation | Bus Operation | Other Operation | |
| Carrying amount of the unit | 1,000 | 2,500 | 2,000 | 800 |
| Estimated remaining useful life | 10 years | 20 years | 10 years | 15 years |
| Value in use | 2,500 | 2,000 | 2,000 | 500 |
The back-office operation and related assets are carried at $ 1 billion. However, Atlantic Shipping considers that only headquarters can be allocated on a reasonable and consistent basis and no allocation of the back-office operations and related assets should be reasonable and consistent. During the impairment review, a proposal of a potential buyer to buy out the whole company has just been received at $ 7.5 billion. Determine the impairment loss and suggest
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