I need help with the bolded part of the question below: (I have also attached a solution key). Why is it that the implied value of the goodwill they calculated (1,800,000) subtracted by the carrying amount of the goodwill, 150,000, ends up equaling (400,000). They then make this amount equal to an impairment loss of (250,000)? Also, I'm confused how to interpret the 200,000 PPE piece of information. Is this saying that the carrying value should be subtracted by 200,000 (answer key shows the opposite)? Need help quickly because I have a final today!

On May 31, 2018, Armstrong Company paid $3,500,000 to acquire all of the common stock of Hall Corporation, which became a division of Armstrong. Hall reported the following balance sheet at the time of the acquisition:

Current assets		$ 900,000		Current liabilities		$ 600,000
Noncurrent assets		2,700,000		Long-term liabilities		500,000
				Stockholder's equity		2,500,000
Total assets		$3,600,000		Total liabilities and stockholder's equity		$3,600,000

It was determined at the date of the purchase that the fair value of the identifiable net assets of Hall was $3,100,000. At December 31, 2018, Hall reports the following balance sheet information:

Current assets		$ 800,000
Noncurrent assets (including goodwill recognized in purchase)		2,400,000
Current liabilities		(700,000	)
Long-term liabilities		(500,000	)
Net assets		$2,000,000

It is determined that the fair value of the Hall division is $2,200,000. The recorded amount for Halls net assets (excluding goodwill) is the same as fair value, except for property, plant, and equipment, which has a fair value of $200,000 above the carrying value.

Assume that the fair value of the Hall division is $1,950,000 instead of $2,200,000. Prepare the journal entry to record the impairment loss, if any, on December 31, 2018. (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 the amount is entered. Do not indent manually.)

Computation of impairment loss: Implied fair value of goodwill Fair value of division less the carrying value of the division (adjusted for fair value changes), net of goodwill: Fair value of Hall division Carrying value of division $2,000,000 Increase in fair value of PP&E 200,000 Less goodwill Implied fair value of goodwill Carrying amount of goodwill Loss on impairment $1,950,000 (400,000) (1,800,000) 150,000 (400,000) $(250,000)