Question 1 of 1 2.72/10 At January 1, 2021, Ivanhoe Limited reported the following property, plant, and equipment accounts: Accumulated depreciation-buildings Accumulated depreciation-equipment Buildings Equipment Land $56,600,000 55,000,000 100,600,000 140,500,000 19,700,000 The company uses straight-line depreciation for buildings and equipment, its year end is December 31, and it makes adjusting entries annually. The buildings are estimated to have a 40-year useful life and no residual value; the equipment is estimated to have a 10-year useful life and no residual value. During 2021, the following selected transactions occurred: Apr. 1 May 1 June 1 Purchased land for $4,040,000. Paid $1,000,000 cash and issued a three-year, 5% mortgage payable for the balance. Interest on the mortgage is payable annually each April 1. Sold equipment for $270,000 cash. The equipment cost $2,820,000 when originally purchased on January 1, 2013 Sold land for $3,926,900. Received $890,900 cash and accepted a three-year, 5% note for the balance. The land cost $1,500,000 when purchased on June 1, 2015. Interest on the note is due annually each June 1. Purchased equipment for $2,000,000 cash. Retired equipment that cost $1,100,000 when purchased on January 1, 2012. No proceeds were received. Tested land for impairment and found that its fair value was $19,700,000. 1 July Dec. 31 31 Dec. 31 Accumulated Depreciation - Equipment 1,100,000 Equipment 1,100,000 (To record depreciation expense) Dec. 31 Impairment Loss 254,000 Land 254,000 (To record the retirement of equipment) Dec. 31 Depreciation Expense 2,515,000 Accumulated Depreciation - Equipment 2,515,000 (To record impairment loss)