El Dorado Foods Inc. owns a chain of specialty stores in the Pacific Northwest. Recently, four of the stores have experienced declining profits due to market saturation in the area. As a result, management gathered data about possible impairment of the assets of the stores. The information gathered was as follows: Book value: $18.00 million Fair value: $15.00 million Undiscounted sum of future cash flows: $17.00 million 

Required: 

Assume that the undiscounted sum of future cash flows is $18.70 million, instead of $17.00 million. Determine the amount, if any, of the impairment loss that El Dorado must recognize on these assets.

Answer rating: 100% (QA)

Impairment loss Impairment loss is recognized when rec... View the full answer