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On 30 June 2020, management believe the entitys equipment used to produce donuts has been...

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Accounting

On 30 June 2020, management believe the entitys equipment used to produce donuts has been impaired and determine recoverable amount to be a value in use of $15,000. The equipment was purchased on 1 January 2018 at a cost of $55,000, residual value of $3,000 and useful life of 4 years. The company uses straight line depreciation and its end of year is 30 June. Required: Determine any impairment loss and prepare the necessary journal entries to record ONLY the impairment loss.

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