Exercise $11-30($Algo$)$ Impairment; property, plant, and equipment $[$LO$11-8]$

General Optic Corporation operates a manufacturing plant in Arizona. Due to a significant decline in demand for the product

manufactured at the Arizona site, an impairment test is deemed appropriate. Management has acquired the following information for

the assets at the plant:

Cost

Accumulated depreciation

General's estimate of the total cash flows to be generated by selling the products

manufactured at its Arizona plant, not discounted to present value

$$52\mathrm{.}5$ million

$$16\mathrm{.}2$ million

$$19\mathrm{.}0$ million

The fair value of the Arizona plant is estimated to be $$21$ million.

Required:

Determine the amount of impairment loss.

If a loss is indicated, prepare the entry to record the loss.

& $4.$ Determine the amount of impairment loss assuming that the estimated undiscounted sum of future cash flows is $(3)$ $$21$ million

instead of $$19$ million and $(4)$ $$36\mathrm{.}55$ million instead of $$19$ million.

Complete this question by entering your answers in the tabs below.

Req $1$

Determine the amount of impairment loss.

Note: Enter your answer in millions rounded to $1$ decimal place $($i$.$e$.,5,500,000$ should be entered as $5\mathrm{.}5).$

Impairment loss