Bridgeport Company uses special strapping equipment in its packaging business. The equipment was purchased in January 2019 for $11,700,000 and had an estimated useful life of 8 years with no salvage value. At December 31, 2020, new technology was introduced that would accelerate the obsolescence of Bridgeports equipment. Bridgeports controller estimates that expected future net cash flows on the equipment will be $7,312,500 and that the fair value of the equipment is $6,435,000. Bridgeport intends to continue using the equipment, but it is estimated that the remaining useful life is 4 years. Bridgeport uses straight-line depreciation.

1. what is the carrying value of the equipment at dec 31 2020?

2. prepare the journal entry (if any to record the impairment at dec 31 2020

3. Prepare any journal entries for the equipment at December 31, 2021. The fair value of the equipment at December 31, 2021, is estimated to be $6,727,500.

4. Prepare the journal entry (if any) to record the impairment at December 31, 2020. assuming that Bridgeport intends to dispose of the equipment and that it has not been disposed of as of December 31, 2021.