Comput anwers in an excel sheet L$04,5$ E$6-33.$ Computing and Assessing Plant Asset Impairment

romewory ${?}_{\text{o}\text{r}\text{s}}$ On July $1,$ Arcola Company purchases equipment for $$330,000.$ The equipment has an estimated useful

life of $10$ years and expected salvage value of $$40,000.$ The company uses straight$-$line depreciation.

Four years later, economic factors cause the fair value of the equipment to decline to $$160,000.$ On this

date, Arcola examines the equipment for impairment and estimates $$185,000$ in undiscounted expected

cash inflows from this equipment.

a$.$ Compute the annual depreciation expense relating to this equipment.

b$.$ Compute the equipment's net book value at the end of the fourth year.

c$.$ Apply the test of impairment to this equipment as of the end of the fourth year. Is the equipment

impaired? Show supporting computations.

d$.$ If the equipment is impaired at the end of the fourth year, compute the impairment loss.

Compute in an excel sheet