The information that follows relates to the assets of Canadian Company as at December 31, Y2...

 

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The information that follows relates to the assets of Canadian Company as at December 31, Y2 (their year-end). Canadian Company has the following asset that has been identified as needing to be tested for impairment. Equipment Cost Accumulated depreciation Undiscounted future cash flows Discounted future cash flows (value in use) Fair value Costs to sell ssssss $ 110,500 $ 52,250 $ 44,500 $ 33,560 $ 34,100 $ 1,250 Remaining useful life in years 6 Instructions: Assume Canadian Company follows IFRS: a) Provide any required entries at December 31, Y2 regarding impairment for the Equipment. Assume depreciation for Y2 has already been recorded. If no entry is required comment on why. Supporting rough work must be shown for part marks. Date Description Dr Cr b) Assume the fair value of the equipment less disposal costs is $52,650 at the end of Y3. Provide any required journal entry to recover impairment at this date. If no entry is required comment on why. Show supporting rough work, if any, for part marks. Date Description Show calculations here: Dr Cr The information that follows relates to the assets of Canadian Company as at December 31, Y2 (their year-end). Canadian Company has the following asset that has been identified as needing to be tested for impairment. Equipment Cost Accumulated depreciation Undiscounted future cash flows Discounted future cash flows (value in use) Fair value Costs to sell ssssss $ 110,500 $ 52,250 $ 44,500 $ 33,560 $ 34,100 $ 1,250 Remaining useful life in years 6 Instructions: Assume Canadian Company follows IFRS: a) Provide any required entries at December 31, Y2 regarding impairment for the Equipment. Assume depreciation for Y2 has already been recorded. If no entry is required comment on why. Supporting rough work must be shown for part marks. Date Description Dr Cr b) Assume the fair value of the equipment less disposal costs is $52,650 at the end of Y3. Provide any required journal entry to recover impairment at this date. If no entry is required comment on why. Show supporting rough work, if any, for part marks. Date Description Show calculations here: Dr Cr