Pearson eText Intermediate Accounting -- Instant Access (Pearson+)
3rd Edition
ISBN: 9780136946649
Author: Elizabeth Gordon, Jana Raedy
Publisher: PEARSON+
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Chapter 12, Problem 12.3E
a.
To determine
To prepare:
Given information:
Estimated fair value is $1,050,000.
Present value of benefit is $1,060,000.
Total cost of asset is $3,200,000.
b.
To determine
To prepare: Journal entry to record revised depreciation expense.
c.
To determine
To calculate: Carrying value of the asset.
Given Information:
Fair value of asset is $725,000.
Undiscounted future cash flow is $745,000.
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Vaughn Company owns equipment that cost $1.035,000 and has accumulated depreciation of $437,000. The expected future net cash
flows from the use of the asset are expected to be $625,000. The fair value of the equipment is $460,000.
Prepare the journal entry, if any, to record the impairment loss. (If no entry is required, select "No entry for the account titles and enter O for
the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. List debit entry before credit
entry)
Account Titles and Explanation
impair
Accumulated Depreciation Equipment
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On December 31, 2021, after a slight mishap, Wreckless Transport Co. decides to evaluate its delivery truck for possible impairment. The company has the following information as of 12-31-2021: Equipment cost 65,000 Accumulated depreciation to date 20,000 Expected future net cash flows 10,000 Fair Value on 12-31-2021 8,000 Disposal costs 2,000 Fair value of equipment on 12-31-2022 15,000 Assume that the company will continue to use this asset in the future. As of December 31, 2021, the equipment has a remaining useful life of 4 years.
INSTRUCTIONS: A Prepare the journal entry, if any, to record impairment at 12-31-2021
B Prepare the journal entry, if any, at December 31, 2022 to record the increase in fair value.
C Prepare the journal entry on 12-31-2021 to record impairment assuming that the company intends to dispose of the truck rather than continue to use it.
Show work to explain please.
Hhi. What is the answr/solution to this problem?
Depreciation by Two Methods; Sale of Fixed Asset
New lithographic equipment, acquired at a cost of $843,750 on March 1 of Year 1 (beginning of the fiscal year), has an estimated useful life of five years and an estimated residual value of $72,600. The manager requested information regarding the effect of alternative methods on the amount of depreciation expense each year.
On March 4 of Year 5, the equipment was sold for $123,600.
Required:
1. Determine the annual depreciation expense for each of the estimated five years of use, the accumulated depreciation at the end of each year, and the book value of the equipment at the end of each year by the following methods:
a. Straight-line method
Year
DepreciationExpense
Accumulated Depreciation,End of Year
Book Value,End of Year
1
$fill in the blank d67bc401dff703b_1
$fill in the blank d67bc401dff703b_2
$fill in the blank d67bc401dff703b_3
2
$fill in the blank…
Chapter 12 Solutions
Pearson eText Intermediate Accounting -- Instant Access (Pearson+)
Ch. 12 - Prob. 12.1QCh. 12 - Can firms group all property, plant, and equipment...Ch. 12 - Prob. 12.3QCh. 12 - Prob. 12.4QCh. 12 - Do firms follow the same steps for impairment...Ch. 12 - Prob. 12.6QCh. 12 - Prob. 12.7QCh. 12 - Prob. 12.8QCh. 12 - Under IFRS, if a firm recovers an impairment loss...Ch. 12 - Under IFRS, when do firms test plant assets and...
Ch. 12 - Prob. 12.11QCh. 12 - Prob. 12.12QCh. 12 - Prob. 12.1MCCh. 12 - Prob. 12.2MCCh. 12 - Prob. 12.3MCCh. 12 - Prob. 12.4MCCh. 12 - Prob. 12.5MCCh. 12 - Prob. 12.6MCCh. 12 - Prob. 12.1BECh. 12 - Prob. 12.2BECh. 12 - Prob. 12.3BECh. 12 - Prob. 12.4BECh. 12 - Indefinite-Life Intangible Asset Impairment....Ch. 12 - Prob. 12.6BECh. 12 - Prob. 12.7BECh. 12 - Prob. 12.8BECh. 12 - Prob. 12.9BECh. 12 - Prob. 12.10BECh. 12 - Prob. 12.11BECh. 12 - Prob. 12.12BECh. 12 - Prob. 12.13BECh. 12 - Prob. 12.14BECh. 12 - Prob. 12.15BECh. 12 - Prob. 12.16BECh. 12 - Prob. 12.17BECh. 12 - Prob. 12.18BECh. 12 - Prob. 12.19BECh. 12 - Prob. 12.20BECh. 12 - Prob. 12.21BECh. 12 - Prob. 12.22BECh. 12 - Prob. 12.23BECh. 12 - Tangible Asset Impairment. Henne Optical...Ch. 12 - Tangible Asset Impairment Loss. Use the same...Ch. 12 - Prob. 12.3ECh. 12 - Prob. 12.4ECh. 12 - Prob. 12.5ECh. 12 - Tangible Asset Impairment Loss, IFRS. Use the same...Ch. 12 - Prob. 12.7ECh. 12 - Prob. 12.8ECh. 12 - Prob. 12.9ECh. 12 - Assets Held for Disposal. Hattie Corporation...Ch. 12 - Prob. 12.11ECh. 12 - Asset Revaluation, Downwards, IFRS. Lousa Company...Ch. 12 - Tangible Asset Impairment. Chrispian Cookies, Inc....Ch. 12 - Prob. 12.2PCh. 12 - Tangible Asset Impairment. Using the same...Ch. 12 - Prob. 12.4PCh. 12 - Goodwill Impairment, Tangible Fixed Assets, and...Ch. 12 - Tangible Asset Impairment, Potential Reversal,...Ch. 12 - Prob. 12.7PCh. 12 - Prob. 12.8PCh. 12 - Prob. 12.9PCh. 12 - Comprehensive Asset Revaluation Problem (Initial...Ch. 12 - Prob. 12.11PCh. 12 - Judgment Case 1: Impairments of PPE under IFRS...Ch. 12 - Prob. 2JCCh. 12 - Prob. 3JCCh. 12 - Financial Statement Analysis Case 1: Long-Lived...Ch. 12 - Surfing the Standards Case 1: Impairments of PPE...Ch. 12 - Prob. 2SSCCh. 12 - Prob. 1BCCCh. 12 - Basis for Conclusions Case 2: Intangible Assets ...Ch. 12 - Basis for Conclusions Case 3: Goodwill Impairment...
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