Willy Inc. manufactures agricultural implements for commercial farms. As a result of recent technological advances, the market demand for one of its garden tractors has been steadily declining. The following assets are used in the manufacturing process.

Cost Accumulated Depreciation Carrying Value

Small Tools $ $12,500$ $ $7,500$ $ $5,000$

Specialized Machinery $75,25055,50019,750$

Standard Machinery $125,000102,50022,500$

The company is currently testing these assets for impairment. It determines that the Small Tools and Specialized Machinery have no other use and as a result no resale value. While the Standard Machinery could be sold today for $$25,000,$ the company plans to keep producing the garden tractors for three more years. It expects net cash flows from production to be $$10,000$ yearly and that it can sell the Standard Machinery for $$17,500$ at the end of year three. The fair value of these assets less the cost of disposal is estimated at $$27,000.$ The current interest rate is $5\%.$

Required: The company follows IFRS and uses the Rational Entity Impairment Model.

a$)$ Is there an impairment loss? If so$,$ how would it be allocated to the assets in the cash$-$generating unit? $($Round your answers to the nearest dollar$)$

b$)$ Provide any related or required journal entry