Question
Salma Company has an intangible asset for a broadcasting license that it is carrying in its records for its initial cost of $950,000. On July
Salma Company has an intangible asset for a broadcasting license that it is carrying in its records for its initial cost of $950,000. On July 30, 2020, while considering the impairment of the asset, the company becomes aware of the fact that the local broadcasting authority is issuing an unlimited amount of licenses to startup companies to stimulate the industry. This will have a negative impact on the company's future cash flows from advertising revenues, and the company conducts a valuation that indicated that the fair value of the license is now $85,000. The journal entry to record the impairment loss will be?
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