Question 2 At 30 June 2016, Martin Ltd has an item of equipment with a cost of $240,000 and accumulated depreciation of $40,000. Martin Ltd's directors estimate that the fair value less costs to sell of the equipment amounts to $155,000 and its value in use amounts to $130,000. Required 1. Calculate the amount of the impairment loss 2. Prepare the journal entries to record the impairment loss 3. Show how the impairment would appear in Martin Ltd's Statement of Financial Position Requirement 1 Step 1: Determine the Recoverable Amount RA is the higher of Fair value less costs of disposal = Value in Use = . Therefore, RA= Step 2: Compare RA and CA RA= CA= . I Requirement 2 DETAILS DR CR DATE 30/06/2016 Recognition of impairment loss SA s Requirement 3 Statement of Financial Position Non-Current Assets