1. Moneo Co. purchased equipment that was installed and ready for use at the beginning of January 2025 for a total cost of $1,250,000. The salvage value was estimated at $200,000. The machinery is depreciated over five years using the straight-line method. At December 31, 2027, the undiscounted expected future net cash flows were $500,000 and the discounted expected net cash flows were $450,000. Instructions 1. Prepare the journal entry to record the impairment loss (if any) at12/31/2027. 2. Assume that Moneo did not use the asset in 2028 and listed it for sale. At 12/31/28, the ass had a fair value of $500,000 and a disposal cost of $10,000. Prepare any journal entry need at that date with regard to the asset.

1. Moneo Co. purchased equipment that was installed and ready for use at the beginning of January 2025 for a total cost of $1,250,000. The salvage value was estimated at $200,000. The machinery is depreciated over five years using the straight-line method. At December 31, 2027, the undiscounted expected future net cash flows were $500,000 and the discounted expected net cash flows were $450,000. Instructions 1. Prepare the journal entry to record the impairment loss (if any) at12/31/2027. 2. Assume that Moneo did not use the asset in 2028 and listed it for sale. At 12/31/28, the ass had a fair value of $500,000 and a disposal cost of $10,000. Prepare any journal entry need at that date with regard to the asset.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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