Question $16$

General Optic Corporation operates a manufacturing plant in Arizona. Due to a significant decline in demand for the product manufactured at the Arizona site, an impairment test is deemed appropriate. Management has acquired the following informatio the assets at the plant:

Cost

Accumulated depreciation

General's estimate of the total cash flows to be generated by selling the products manufactured at its Arizona plant, not discounted to present value

$$49\mathrm{.}5$ million

$$15\mathrm{.}9$ million

$$18\mathrm{.}4$ million

The fair value of the Arizona plant is estimated to be $$19\mathrm{.}5$ million.

Required:

Determine the amount of impairment loss.

If a loss is indicated, prepare the entry to record the loss.

& $4.$ Determine the amount of impairment loss assuming that the estimated undiscounted sum of future cash flows is $(3)$ $$19\mathrm{.}5$ million instead of $$18\mathrm{.}4$ million and $(4)$ $$34\mathrm{.}25$ million instead of $$18\mathrm{.}4$ million.

Complete this question by entering your answers in the tabs below.

$\backslash$table$[[$Req $1,$Req $3$ and $4]]$

Determine the amount of impairment loss.

Note: Enter your answer in millions rounded to $1$ decimal place $($i$.$e$.,5,500,000$ should be entered as $5\mathrm{.}5).$