Question
Desert Reports the following for a piece of machinery. Demand for the product the machinery produces has declined so Desert deems it appropriate to test
Desert Reports the following for a piece of machinery. Demand for the product the machinery produces has declined so Desert deems it appropriate to test the asset for impairment. Balances are current as of the date of the impairment check.
| Cost | $ 490,000 |
| Accumulated Depreciation | $ 80,000 |
| Fair Value | $ 400,000 |
| Undiscounted Sum of Net Future Cash Flows | $ 420,000 |
Is the asset impaired?
a)Yes
b)No
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Managerial Accounting Tools for business decision making
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
6th Edition
978-0470477144, 1118096894, 9781118214657, 470477148, 111821465X, 978-1118096895
