York Corp., a Canadian public corporation, owns equipment for which the following year-end information is available:

• Carrying amount (book value)....................................$59,000
• Undiscounted expected future cash flow................... 62,000
• Discounted expected future cash flow ....................... 50,000
• Fair value ........................................................................ 57,000
• cost to sale .................................................................... 5,000

Which of the following best describes the proper accounting treatment for York's equipment?

Question 47Select one:

a.

It is impaired and a loss must be recognized, but the loss may be reversed in future periods.

b.

It is not impaired and a loss should not be recognized.

c.

It is impaired and a loss must be recognized, with no reversal possible.

d.

It is not impaired, but a loss must be recognized.