Measurement of impairment loss and R&D Cowboy Luke, a publicly listed London based company, has specialized equipment which makes wooden rocking horses. All British publicly listed companies are required to use IFRS. Their financial year ends on 12/31. At the end of 2016, the equipment has the following characteristics: Carrying amount (net of accumulated depreciation, including 2016) 750,000 FV of the asset 800,000 Cost to sell 60,000 Sum of the future cash flows 780,000 Present Value of the future cash flows 735,000 Remaining Useful Life 6 years at the end of 2016 It is depreciated using the straight line method. Assume there is no residual value.

1. Calculate the recoverable amount.

2. Determine if there is an impairment of this asset.

3. Write the journal entry (if there is one). If not, tell me there is no journal entry.

4. Determine the amount of depreciation expense and book value (carrying amount) at the at the end of the year 2017.