Danier Leather Inc. is a Canadian company that designs, manufactures, and markets quality leather and suede products for both women and men. The following note and information were reported in a recent annual report:
Note 3€” SIGNIFICANT ACCOUNTING POLICIES
Impairment of non- financial assets Property and equipment and computer software with finite lives are tested for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable at the financial position date. For purposes of measuring recoverable amounts, assets are grouped at the lowest levels for which there are separately identifiable cash flows ( cash- generating units or CGUs), which is at the individual store level for the Company. The recoverable amount is the greater of an asset€™s fair value less costs to sell and value in use ( being the present value of the expected future cash flows of the relevant asset or CGU). An impairment loss is recognized for the amount by which the asset€™s carrying amount exceeds its recoverable amount. The Company evaluates impairment losses for potential reversals when events or circumstances warrant such consideration.

Required:
1. Reconstruct the journal entry for the disposal of equipment during the year.
2. Compute the amount of property, plant, and equipment that Danier Leather wrote off as impaired during the year. Danier records impairment losses as adjustments to accumulated depreciation.

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Dollars in thousands Cost of property, plant, and equipment (beginning of year) Cost of property, plant, and equipment (end of year) Additions to property, plant, and equipment during the year Accumulated depreciaton and impairment losses (beginning of year) Accumulated depreciation and impaiment losses (end of year) Depreciation expense during the year Cost of equipment sold during the year Accumulated depreciaton on equipment sold Cash received on equipment sold $43,742 42,846 3,974 29,338 27,834 3,300 4,870 4,870 65