Make all adjustments on the Adjusting Journal Entries. Remember to include a description under each journal entry. It would be unusual for a company to have an asset impairment in Year $1,$ but for the sake of this example, ABC determined that their intangible asset might be impaired on December $31,2021.$ Record the impairment adjustment, if any. The expected future undiscounted net cash flows for this intangible asset totals $$175,000,$ and the fair value of the asset is $$165,000.$