Question

Presented below is net asset information related to the Windsor Division of Santana, Inc. Windsor Division Net Assets As of December 31, 2020 (in millions) $61 Cash 210 Accounts receivable Property, plant, and equipment (net) 2,605 Goodwill 211 Less: Notes payable (2,600) $487 Net assets The purpose of the Windsor Division is to develop a nuclear-powered aircraft. If successful, traveling delays associated with refueling could be substantially reduced. Many other benefits would also occur. To date, management has not had much success and is deciding whether a write-down at this time is appropriate. Management estimated its future net cash flows from the project to be $405 million. Management has also received an offer to purchase the division for $335 million (deemed an appropriate fair value). All identifiable assets' and liabilities' book and fair value amounts are the same.

Answer 1

Date	Accounts title	Debit	Credit
Dec-20	Profit & Loss AC………………Dr	$152
	Good will		$152
	( Being impairment Entry Passed)
Dec-21	No entry