Exercise 11 16 Presented below is information related to equipment owned by Suarez Company at December 31, 2014 Cost $ 18,720,000 Accumulated depreciation to date 2,080,000 Expected future net cash flows 14,560,000 Fair value 9,984,000 Assume that Suarez will continue to use this asset in the future As of December 31, 2014, the equipment has a remaining useful life of 5 years Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2014 (If no entry is required, select No entry for the account titles and enter 0 for the amounts Credit account titles are automatically indented when amount is entered Do not indent manually ) Date Account Titles and Explanation Debit Credit Dec 31 Prepare the journal entry to record depreciation expense for 2015 (If no entry is required, select No entry for the account titles and enter 0 for the amounts Credit account titles are automatically indented when amount is entered Do not indent manually ) Account Titles and Explanation Debit Credit The fair value of the equipment at December 31, 2015, is $10,608,000 Prepare the journal entry (if any) necessary to record this increase in fair value (If no entry is required, select No entry for the account titles and enter 0 for the amounts Credit account titles are automatically indented when amount is entered Do not indent manually ) Date Account Titles and Explanation Debit Credit Dec 31

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Exercise 11-16 Presented below is information related to equipment owned by Suarez Company at December 31, 2014. Cost $ 18,720,000 Accumulated depreciation to date 2,080,000

Exercise 11-16

Presented below is information related to equipment owned by Suarez Company at December 31, 2014.

Cost		$ 18,720,000
Accumulated depreciation to date		2,080,000
Expected future net cash flows		14,560,000
Fair value		9,984,000

Assume that Suarez will continue to use this asset in the future. As of December 31, 2014, the equipment has a remaining useful life of 5 years.

Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2014. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date	Account Titles and Explanation	Debit	Credit
Dec. 31

Prepare the journal entry to record depreciation expense for 2015. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit

The fair value of the equipment at December 31, 2015, is $10,608,000. Prepare the journal entry (if any) necessary to record this increase in fair value. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)