AAA corp. had the following PP&E values on Dec. 31, 2018.
Cost $ 20
Accumulated Depreciation $ 5
Undiscounted Future Cash Flow $ 12
Fair Value $ 11
Costs to Sell 0
Value-in-use (PV of Future Cash Flow) $ 13
Questions:
[1] Under U.S. GAAP, prepare the journal entry for PP&E impairment if necessary.
[2] Under U.S. GAAP, what is the dollar amount of PP&E carrying value after impairment?
[3] Under IFRS, prepare the journal entry for PP&E impairment if necessary.
[4] Under IFRS, what is the dollar amount of PP&E carrying value after impairment?
The following information is for a copyright owned by Bridgeport Corp., a private entity, at December 31, 2020. Bridgeport Corp. applies ASPE. Cost Carrying amount Expected future net cash flows (undiscounted) Fair value $4,322,000 2,141,000 2,028,000 1,628,000 Assume that Bridgeport Corp. will continue to use this copyright in the future. As at December 31, 2020, the copyright is estimated to have a remaining useful life of 10 years. Prepare the journal entry, if any, to record the asset's impairment at...
Presented below is information related to copyrights owned by Taylor Corporation at December 31, 2020. Carrying amount 7,000,000 Expected future net cash flows 6,200,000 Fair value 3,300,000 Assume Taylor will continue to use this asset in the future. As of December 31, 2020, the copyrights have a remaining useful life of 5 years. Instructions (a) Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2020. (b) Prepare the journal entry to record amortization expense for...
Hirsch Company acquired equipment at the beginning of 2020 at a cost of $135,900. The equipment has a six-year life with no expected salvage value and is depreciated on a straight-line basis. At December 31, 2020, Hirsch compiled the following information related to this equipment: Expected future cash flows from use of the equipment$117,200Present value of expected future cash flows from use of the equipment102,400Fair value (selling price less costs to dispose)98,300 Assume that Hirsch Company is a U.S.-based company that is issuing...
Bridgeport Corp., a small company that follows ASPE, owns machinery that cost $945,000 and has accumulated depreciation of $360,000. The undiscounted future net cash flows from the use of the asset are expected to be $561,000. The equipment’s fair value is $455,000. Using the cost recovery impairment model, prepare the journal entry, if any, to record the impairment loss. Account Titles and Explanation Debit Credit
ABC corp has decided to evaluate a piece of equipment for impairment on Jan. 1, 2018 (fiscal year ending Dec. 31). ABC corp purchased the equipment on Jan. 1, 2016 for $260,000 and has used straight line depreciation method. The equipment has a residual value of $20,000 and a six year useful life. The estimated undercounted future cash flows from the machine are $150,000. ABC corp uses a 10% discount rate. The estimated fair value is $132,000. Present the steps...
Izmir AS issued convertible bonds at their face value of 102,000 lira on December 31, 2017. The bonds have a 12-year life with interest of 9 percent payable annually. At the date of issue, the prevailing interest rate for similar debt without a conversion option was 11 percent Assume that a foreign company using IFRS is owned by a company using U.S. GAAP. Thus, IFRS balances must be converted to U.S. GAAP to prepare consolidated financial statements. Ignore income taxes...
Please help!! Thank you!
1: Data Table Plant and Equipment Asset Group Cost 4,230,000 (2,115,000) Less: Accumulated Depreciation/Amortization 2,115,000 Carrying value Future cash flows (occurring at the end of each year) Remaining Life Year $ 2019 2020 2021 2022 2023 640,000 500,000 389,000 2024 1,529,000 Total undiscounted future cash flows || on 1,399,071 Total discounted future cash flows at 5% llel 1,236,000 Fair value 1. On December 31, 2018, Upton Enterprises must measure its impairment loss for plant and equipment....
On January 2, 2020, Cheyenne Corp. reported the following
intangible assets: (1) copyright with a carrying value of $23,000,
and (2) a trade name with a carrying value of $8,800. The trade
name has a remaining life of 5 years and can be renewed at nominal
cost indefinitely. The copyright has a remaining life of 10
years.
On January 2, 2020, Cheyenne Corp. reported the following intangible assets: (1) copyright with a carrying value of $23,000, and (2) a trade...
Izmir A.S.issued convertible bonds at their face value of 134,000 lira on December 31, 2017. The bonds have a 10-year life with interest of 11 percent payable annually. At the date of issue, the prevailing interest rate for similar debt without a conversion option was 13 percent. Assume that a foreign company using IFRS is owned by a company using U.S. GAAP. Thus, IFRS balances must be converted to U.S. GAAP to prepare consolidated financial statements. Ignore income taxes. Required:...
In early 2018, Bowen Company acquired a new business unit in a merger. Allocation of the acquisition cost resulted in fair values assigned as follows: Intangible Asset Fair Value Estimated Value Customer lists $500,000 5 years Developed technology 800,000 10 years Internet domain name 1,300,000 Indefinite Goodwill* 6,200,000 Indefinite * The goodwill is assigned entirely to the acquired business unit. Impairment reviews at the end of 2018 and 2019 did not identify any impairment losses. After the business suffered a...