Prepare the journal entry to record the impairment

Assignment Help Financial Accounting

Reference no: EM13755637

Presented below is information related to equipment owned by Suarez Company at December 31, 2014.

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, 2014, the equipment has a remaining useful life of 4 years.

Impairment) Assume the same information as E11-16, except that Suarez intends to dispose of the equipment in the coming year. It is expected that the cost of disposal will be $20,000.

Instructions

(a)Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2014.

(b) Prepare the journal entry (if any) to record depreciation expense for 2015.

$5,300,000. Prepare the journal entry (if any) necessary to record this increase in fair value. It is expected that the cost of disposal is still $20,000

Reference no: EM13755637

Questions Cloud

Evaluate impact of one federal and one state-level policy : The development of MCOs has been influenced by the type of market they serve. For example, BCBS companies moved from primarily a service plan provider to a multiproduct line that includes HMO, PPO, and consumer choice plans. Evaluate the impact of on..

Approach and his concept of unconditional positive : Explain Rogers' person-centered approach and his concept of unconditional positive regard. How is this approach different from other humanistic approaches, and from the models that you have studied earlier in the course?

Operational efficiency and effectiveness : Suggest how health care leaders can use project metrics and portfolio management to ensure operational efficiency and effectiveness. Provide specific examples to support the response

Budgeted direct labor cost for january : Fantastic Futons goes through two departments in the production process. Each futon requires two direct labor hours in Department A and one hour in Department B. Labor cost is $8 per hour in Department A and $10 per hour in Department B.Assuming t..

Prepare the journal entry to record the impairment : Assume that Suarez will continue to use this asset in the future. As of December 31, 2014, the equipment has a remaining useful life of 4 years. Impairment) Assume the same information as E11-16, except that Suarez intends to dispose of the equipment..

Conduct an appropriate quantitative analysis : American International Automotive Industries (AIAI) manufactures auto and truck engine, transmission, and chassis parts for manufacturers and repair companies in the United States, South America, Canada, Mexico, Asia, and Europe. T

Match the affect to the transaction : Match the affect to the transaction :

Describe the connection between power and leadership : •Describe the connection between power and leadership as explained in the textbook. •Choose a personal situation where you were a leader. What type of leader were you? Do you think you were an effective leader? How did having power affect you? Did yo..

Why you think the network is effective and efficient : Select a business that you believe has a good communication network. Examine its network design and explain why you think the network is effective and efficient

User Account

All Pages