eBook Videos Print BE12-42.Rand.02 Question 6 Partially correct Mark 1.04 out of 1.25 Recording Impairment Loss...

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eBook Videos Print BE12-42.Rand.02 Question 6 Partially correct Mark 1.04 out of 1.25 Recording Impairment Loss on Asset Held for Sale Flag question WellCon Corporation, a calendar-year corporation, plans to dispose of a plant asset with a carrying value of $40,000 (cost is $60,000 and accumulated depreciation is $20,000) on December 31 of Year 1 after recording depreciation on the asset. The fair value of the asset is $32,000 at that time, and estimated costs to sell are $4,000. The asset remains in WellCon's possession one year later. The fair value and estimated costs to sell are $33,600 and $1,600 on December 31 of Year 2. Provide the entries on December 31 of Year 1 and Year 2 to record the impairment loss and revaluation. Note: If a line in a journal entry isn't required for the transaction, select "N/A" as the account names and leave the Dr. and Cr. answers blank (zero). Date Account Name Dec. 31, Year 1 Loss on Impairment Cr. Dr. 12,000 0 Gain on Reversal of Impairment Loss = 10,400 x 0 12,000 0 10,400 x Accumulated Depreciation Dec. 31, Year 2 Accumulated Depreciation Check eBook Videos Print BE12-42.Rand.02 Question 6 Partially correct Mark 1.04 out of 1.25 Recording Impairment Loss on Asset Held for Sale Flag question WellCon Corporation, a calendar-year corporation, plans to dispose of a plant asset with a carrying value of $40,000 (cost is $60,000 and accumulated depreciation is $20,000) on December 31 of Year 1 after recording depreciation on the asset. The fair value of the asset is $32,000 at that time, and estimated costs to sell are $4,000. The asset remains in WellCon's possession one year later. The fair value and estimated costs to sell are $33,600 and $1,600 on December 31 of Year 2. Provide the entries on December 31 of Year 1 and Year 2 to record the impairment loss and revaluation. Note: If a line in a journal entry isn't required for the transaction, select "N/A" as the account names and leave the Dr. and Cr. answers blank (zero). Date Account Name Dec. 31, Year 1 Loss on Impairment Cr. Dr. 12,000 0 Gain on Reversal of Impairment Loss = 10,400 x 0 12,000 0 10,400 x Accumulated Depreciation Dec. 31, Year 2 Accumulated Depreciation Check