presented below is information related to equipment owned by sua 253734

Presented below is information related to equipment owned by Suarez Company at December 31, 2007.

Cost ……………………………………. $9,000,000

Accumulated depreciation to date ……… 1,000,000

Expected future net cash flows ………… 7,000,000

Fair value ……………………………….. 4,800,000

Assume that Suarez will continue to use this asset in the future. As of December 31, 2007, the equipment has a remaining useful life of 4 years.

Instructions

(a) Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2007.

(b) Prepare the journal entry to record depreciation expense for 2008.

(c) The fair value of the equipment at December 31, 2008, is $5,100,000. Prepare the journal entry (if any) necessary to record this increase in fair value.

Related Articles

armstrong helmet company 239138

Armstrong Helmet Company manufactures a unique model of bicycle helmet Question Case project Learning Objectives: Prepare practical applications of course concepts Develop analytical and critical thinking Develop decision-making capabilities Enhance professional...

read more
GET A FREE QUOTE





  
Open chat
Need help? We are Online 24/7
Hello 👋
Can we help you?