Reference no: EM132495334

Cougar Corp.'s balance sheet includes the following asset:

Equipment.......................................................... $95,000

Less: accumulated depreciation.......................... (25,000)

Book value (carrying amount)............................. $70,000

After performing its annual review for impairment, Cougar obtains the following data:

Asset's value in use.............................................. $58,000

Fair value less disposal costs................................. 62,000

Required:

Assuming Cougar uses the rational entity impairment model,

Question a) Calculate the recoverable amount.

Question b) Calculate the impairment loss.

Question c) Prepare the entry to record the impairment loss.

Question d) Briefly explain the term "value in use".