Lily, Inc., sells electronics and appliances. The excerpts that follow are adapted from Lilys financial statements for

Lily, Inc., sells electronics and appliances. The excerpts that follow are adapted from Lily’s financial statements for 2012 and 2011.

Requirements
1. How much was Lily’s cost of plant assets at February 28, 2012? How much was the book value of plant assets? Show computations.
2. The financial statements give three evidences that Lily purchased plant assets and goodwill during fiscal year 2012. What are they?
3. Prepare T-accounts for Property, Plant, and Equipment; Accumulated Depreciation; and Goodwill. Then show all the activity in these accounts during 2012. Label each increase or decrease and give its dollar amount. During 2012, Lily sold plant assets that had cost the company $77 million (accumulated depreciation on these assets was $66 million). Assume goodwill was not impaired during 2012.
4. (Independent of the information in Requirement 3) Lily reviews its assets for impairment annually. On February 28, 2012, the fair value of the goodwill is estimated at $450 million.
Prepare the journal entry to record theimpairment.

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February 28 2012 2011 Balance Sheet (dollars in millions) Assets Total current assets $7,988 56,904 Less: Accumulated depreciation Goodwill 557 510 Year Ended February 28 2012 2011 Statement of Cash Flows (dollars in millions) Operating activities: 49 $ 980 Net income Noncash items affecting net income: Depreciation vesting activities: Additions to property, plant, and equipment(723) (615) 461 459 In