Question: Assume the same facts as in E 7-31, but that Lewis determines credit losses using the CECL model introduced in ASU 2016-13 and required in

Assume the same facts as in E 7-31, but that Lewis determines credit losses using the CECL model introduced in ASU 2016-13 and required in 2020. Determine the amount of credit losses that Lewis would recognize for these two loans.
In E 7-31
At January 1, 2018, Lewis Enterprises has the following individual notes receivable that it is considering for impairment:
∙ A $2 million note (including accrued interest) from Bebko Inc. Lewis believes it is probable that Bebko will default on the note, and calculates the net realizable value of the receivable to be $1.4 million.
∙ A $3 million note (including accrued interest) from Dutta Associates. Lewis believes it is possible but not probable that Dutta will default on the note, and calculates the net realizable value of the receivable to be $2.5 million.

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