PART TWO-OBJECTIVE QUESTIONS (37 POINTS) A) Impairment (15 points) Under each of the following independent cases, indicate which type of impairment test/s are needed, using the appropriate code from the table below, and determine the amount of the impairment loss for the year indicated in each case. Use the table on the cover page to fill in your answers. Impairment Test Code Recoverability test R Fair value test F Fair value test on reporting unit U I Fair value test on implied goodwill 1. AL-Salam Company has an equipment with a cost of $2,000,000 and accumulated depreciation of $700,000. The investigation revealed that the sum of the estimated future net cash flows generated from the equipment is $1,000,000, and the discounted future net cash flows are $800,000. Al-Salam intends to continue to use this asset in the future. R 2. Rantisi Company has a manual pressing olive machine with a cost of $5,000,000 and accumulated depreciation of $2,000,000. Due to new technology, the investigation revealed that the sum of the estimated future net cash flows generated from the equipment is $2,000,000, and the discounted future net cash flows are $1,800,000. Rantisi is planning to dispose of the asset. It is expected that the cost of disposal will be $50,000. 3. FM Radio purchased a broadcast license for $2,500,000, which is expected to have an indefinite life. It performs an impairment test and determines that the fair value of the intangible asset is $1,800,000. 4. ABC division has a fair value of $650,000 on December 31, 2021. Items Cash & Receivable Inventory Equipment Goodwill Current Payables Bonds Payable Carrying value Fair value 500,000 500,000 180,000 200,000 420,000 300,000 350,000 280,000 290,000 300,000 250,000 I 650,000 7460,000