Explain the concept and recording of asset impairment.

- Impairment exists when the recoverable amount of an asset is less than the carrying value of the asset.

- An impairment loss, the excess of the carrying value over the recoverable amount of the asset, is recognized and the asset is reduced.

- The recoverable amount of an asset is the greater of the asset's value in use and fair market value, less disposal costs, of the asset if sold.