Matt Jones recently joined Kind Company as a staff accountant in the controller's office. Kind Company provides warehousing services for companies in several East Coast cities. The location in Philadelphia, PA, has not been performing well due to increased competition and the loss of several customers that have recently gone out of business. Matt's department manager suspects that the plant and equipment may be impaired and wonders whether those assets should be written down. Given the company's prior success, this issue has never been considered in the past, and Matt has been asked to conduct some research on this issue.

Instructions:

Access the FASB Codification and provide codification references to support your responses.

1. What is the authoritative guidance for asset impairments? Briefly discuss the scope of the standard (i.e., explain the types of transactions to which the standard applies).
2. Give several examples of events that would cause an asset to be tested for impairment. Does it appear that Kind should perform an impairment test? Explain.
3. What is the best evidence of fair value? Describe alternate methods of estimating fair value.