Hirsch Company acquired equipment at the beginning of 2020 at a cost of $135,000. The equipment has a five-year life with no expected salvage value and is depreciated on a straight-line basis. At December 31, 2020, Hirsch compiled the following information related to this equipment:

Expected future cash flows from use of the equipment	$	116,400
Present value of expected future cash flows from use of the equipment		101,400
Fair value (selling price less costs to dispose)		97,030

Assume that Hirsch Company is a U.S.-based company that is issuing securities to foreign investors who require financial statements prepared in accordance with IFRS. Thus, adjustments to convert from U.S. GAAP to IFRS must be made. Ignore income taxes.

1. Prepare the entry(ies) that Hirsch would make on the December 31, 2020, and December 31, 2021, conversion worksheets to convert U.S. GAAP balances to IFRS. Ignore the possibility of any additional impairment at the end of 2021.

Prepare the entry(ies) that Hirsch would make on the December 31, 2020, and December 31, 2021, conversion worksheets to convert U.S. GAAP balances to IFRS. Ignore the possibility of any additional impairment at the end of 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No General Journal Debit Credit Date 12/31/2020 1 2,000 Impairment loss Equipment 8,000 2 12/31/2021 8,000 Retained earnings Equipment 10,000 3 12/31/2021 25,000 Accumulated depreciation Equipment Depreciation expense 27,000