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In late July 2020, Ayayal Ltd, a private company, paid $2 million to acquire all of the net assets of Whispering Winds Corp., which then

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In late July 2020, Ayayal Ltd, a private company, paid $2 million to acquire all of the net assets of Whispering Winds Corp., which then became a division of Ayayal Whispering Winds reported the following statement of financial position at the time of acquisition Current assets Non-current assets $415,000 1,335,000 Current liabilities Long-term liabilities Shareholders' equity $300,000 265,000 1,185,000 $1,750,000 $1,750,000 It was determined at the date of the purchase that the fair value of the identifiable net assets of Whispering Winds was $1.5 million. Over the next six months of operations, the new division had operating losses. In addition, it now appears that it will generate substantial losses for the foreseeable future. At December 31, 2020, the fair value of the Whispering Winds Division is $1,900,000, and the division reports the following statement of financial position information: Current assets Non-current assets (including goodwill recognized in purchase) Current liabilities Long term liabilities $465.000 2,400,000 (703,000 (526,000) $1.636,000 Net assets Assume that Ayayal Ltd, prepares financial statements in accordance with ASPE. Calculate the amount of goodwill, if any, that should be recognized in late July 2020, Goodwill $ List of Accounts Determine the loss on impairment, if any, to be recognized on December 31, 2020. (If an answer is zero, please enter 0. Do not leave any fields blank) Impairment loss $ Assume that the fair value of the Whispering Winds Division on December 31, 2020, is $1.4 million. Determine the loss on impairment, if any, that would be recognized Impairment loss $ Prepare the journal entry to record the loss on impairment, If any. (Credit account titles are automatically Indented when the amount is entered. Do not Indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts:) Date Account Titles and Explanation Debit Credit Dec 31, 2020

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