Exercise 6 Reveille, Inc uses special strapping equipment in its packaging business. The equipment was purchased in January 2019 for $6,000,000 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 Reveille's equipment. Reveille's controller estimates that expected future net cash flows on the equipment will be $3,750,000 and that the fair value of the equipment is $3,300,000. Reveille intends to continue using the equipment, but it is estimated that the remaining useful life is 4 years. Reveille uses straight-line depreciation Instructions (a) What is the carrying value of the asset? (b) Prepare the journal entry (if any) to record the impairment at December 31, 2020 (c) 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 $3,450,000. Exercise 7 On January 2, 2020, Whistler Company purchased land for $450,000, from which it is estimated that 400,000 tons of ore could be extracted. It estimates that the present value of the cost necessary to restore the land is $80,000, after which it could be sold for $30,000. During 2020, Whistler mined 80,000 tons and sold 50,000 tons. During 2021, Whistler mined 100,000 tons and sold 120,000 tons. Whistler uses a FIFO cost flow assumption. Instructions: (a) Calculate the depletion included in the income statement and ending inventory for 2020 and 2021. Round the depletion rate to 2 decimal places. (b) Prepare the natural resources section of the balance sheet on December 31, 2020 and 2021, assuming that an accumulated depletion account is used