PowerEx Corp. designs and manufactures alternate clean energy solutions for homeowners across Canada. On January 1, 2017, the company took advantage of the various government incentive programs and constructed a new $4,000,000 research facility in Kelowna, BC. The facility is expected to have a useful life of 20 years and a residual value of $400,000. PowerEx received the following government subsidies:

- A forgivable loan of $200,000 to assist in the financing of the facility. The loan will be forgiven over the next five years if the company employs at least 60 workers per year in the Okanagan Region in the new facility.

- The company also spent $500,000 on research and development which had been expensed previously. These costs are eligible for a 10% tax credit.

Requirement: Round all answers to the nearest dollar. No decimal places.

In 2019, the government changed legislation concerning the production of clean energy solutions. Based on this new source of information, the facility’s current appraised value is $3,600,000. Cost of disposal, such as legal and broker fees $96,000, dismantling and site restoration cost $200,000 and finance charges $240,000. Value in use $3,410,000. Assume the company had a prior year revaluation surplus of $35,000.

Prepare journal entries to record impairment for year end 2019. Show all calculations for full marks.