Goodwill Impairment Test-After Adoption of FASB ASU 2017-04 Assume the equity method Equity Investment account relating to a subsidiary has a reported balance of $10,040,000, including $960,000 of Goodwill. The fair value of the subsidiary is $9.000.000. The fair value of the subsidiary's individually identifiable net assets is $8,600,000. Th subsidiary has only one reporting unit, which is the same as the overall entity. For this fact set, determine whether Goodwill is impaired and, if so, the amount of impairment. Enter the impairment amount below. If goodwill in not impaired, enter zero. $ 400.000 x Prepare the required journal entry if you determine Goodwill is impaired. If goodwill is not impaired, select "No entry" as your answers under Description and leave the Debit and Credit answers blank (zero). Credit Description Equity income from subsidiary Equity investment Debit ✔ 560,000 * 0✔ 0✓ 560,000 x

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
Goodwill Impairment Test-After Adoption of FASB ASU 2017-04
Assume the equity method Equity Investment account relating to a subsidiary has a reported balance of $10,040,000, including $960,000 of Goodwill. The fair value of the subsidiary is $9,000,000. The fair value of the subsidiary's individually identifiable net assets is $8,600,000. The
subsidiary has only one reporting unit, which is the same as the overall entity.
For this fact set, determine whether Goodwill is impaired and, if so, the amount of impairment.
Enter the impairment amount below. If goodwill in not impaired, enter zero.
$ 400,000 x
Prepare the required journal entry if you determine Goodwill is impaired.
If goodwill is not impaired, select "No entry" as your answers under Description and leave the Debit and Credit answers blank (zero).
Credit
Description
Equity income from subsidiary
Equity investment
Debit
560,000
560,000 x
Transcribed Image Text:Goodwill Impairment Test-After Adoption of FASB ASU 2017-04 Assume the equity method Equity Investment account relating to a subsidiary has a reported balance of $10,040,000, including $960,000 of Goodwill. The fair value of the subsidiary is $9,000,000. The fair value of the subsidiary's individually identifiable net assets is $8,600,000. The subsidiary has only one reporting unit, which is the same as the overall entity. For this fact set, determine whether Goodwill is impaired and, if so, the amount of impairment. Enter the impairment amount below. If goodwill in not impaired, enter zero. $ 400,000 x Prepare the required journal entry if you determine Goodwill is impaired. If goodwill is not impaired, select "No entry" as your answers under Description and leave the Debit and Credit answers blank (zero). Credit Description Equity income from subsidiary Equity investment Debit 560,000 560,000 x
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps with 1 images

Blurred answer
Knowledge Booster
Revenue Recognition
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education