56. On 1 July 2015 a plant is acquired at a cost of $6 million. The asset is to be depreciated using the straight-line method on the basis of an estimated useful life of 15 years and a negligible residual value.

On 30 June 2018 it is determined that the asset has a value in use of $4 million and a fair value of $3.6 million before costs of disposal of $50 000. The remaining useful life of the asset is reassessed to be 8 years.

The appropriate impairment loss journal entry on 30 June 2018 would be:

a.

	Dr Impairment Loss	400 000
	CR Accum. deprec. & impairment losses		400 000

b.

	Dr Impairment Loss	800 000
	CR Accum. deprec. & impairment losses		800 000

c.

	Dr Impairment Loss	1 200 000
	CR Accum. deprec. & impairment losses		1200 000

d.

there is no impairment loss

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