Please assist with question below: Computing and Assessing Plant Asset Impairment Zeibart...
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Computing and Assessing Plant Asset Impairment Zeibart Company purchases equipment for $225,000 on July 1, 2012, with an estimated useful life of 10 years and expected salvage value of $25,000. Straight-line depreciation is used. On July 1, 2016, economic factors cause the market value of the equipment to decline to $90,000. On this date, Zeibart examines the equipment for impairment and estimates $125,000 in future cash inflows related to use of this equipment. a. Is the equipment impaired at July 1, 2016? Yes b. If the equipment is impaired on July 1, 2016, compute the impairment loss and prepare a journal entry to record the loss. Description Debit Credit Impairment loss Equipment
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