How much impairment loss should the company recognize

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Problem 1: On January 1, 2005, Weber Rental Car Company purchased a new rental car for $25,000. The estimated useful life is 5 years with salvage value of $3,000. The car is depreciated using straight-line method. On December 31, 2007, no change is made with regard to any original estimate for this car. On December 31, 2007, the current market value for the car is $7,000 and the company expects that the car will generate rental income of $2,500 and $2,200 during the next two years. How much impairment loss should the company recognize for this rental car?

A) $0
B) $4,100
C) $4,800
D) $3,000

Reference no: EM132708416

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