NOTE 1-SUMMARY OF ACCOUNTING POLICIES Property, Plant and Equipment We review long-lived assets for impairment when circumstances indicate the carrying amount of an asset may not be recoverable based on the undiscounted future cash flows. If the carrying amount of the asset is determined not to be recoverable, a write-down to fair value is recorded. Fair values are determined based on quoted market values, discounted cash flows, or external appraisals, as appropriate. Cost of property and equipment (beginning of year) Cost of property and equipment (end of year) Capital expenditures during the year Accumulated depreciation (beginning of year) Accumulated depreciation (end of year) Depreciation expense during the year Cost of property and equipment sold during the year Accumulated depreciation on property sold Cash received on property sold Required: Complete this question by entering your answers in the tabs below. Dollars in Millions $ 54,644 59,766 6,510 28,016 29,310 1. Reconstruct the journal entry for the disposal of property and equipment during the year. 2. Compute the amount of property and equipment that United Presents wrote off as impaired during the year, if any. (Hint: Set up T- accounts.) Required 2 2,490 1,388 1,196 130 Required 1 Compute the amount of property and equipment that United Presents wrote off as impaired during the year, if any. (Hint: Set up T-accounts.) Note: Enter your answer in millions (i.e., 10,000,000 should be entered as 10). Impairment loss million
NOTE 1-SUMMARY OF ACCOUNTING POLICIES Property, Plant and Equipment We review long-lived assets for impairment when circumstances indicate the carrying amount of an asset may not be recoverable based on the undiscounted future cash flows. If the carrying amount of the asset is determined not to be recoverable, a write-down to fair value is recorded. Fair values are determined based on quoted market values, discounted cash flows, or external appraisals, as appropriate. Cost of property and equipment (beginning of year) Cost of property and equipment (end of year) Capital expenditures during the year Accumulated depreciation (beginning of year) Accumulated depreciation (end of year) Depreciation expense during the year Cost of property and equipment sold during the year Accumulated depreciation on property sold Cash received on property sold Required: Complete this question by entering your answers in the tabs below. Dollars in Millions $ 54,644 59,766 6,510 28,016 29,310 1. Reconstruct the journal entry for the disposal of property and equipment during the year. 2. Compute the amount of property and equipment that United Presents wrote off as impaired during the year, if any. (Hint: Set up T- accounts.) Required 2 2,490 1,388 1,196 130 Required 1 Compute the amount of property and equipment that United Presents wrote off as impaired during the year, if any. (Hint: Set up T-accounts.) Note: Enter your answer in millions (i.e., 10,000,000 should be entered as 10). Impairment loss million
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:NOTE 1-SUMMARY OF ACCOUNTING POLICIES
Property, Plant and Equipment
We review long-lived assets for impairment when circumstances indicate the carrying amount of an asset may not be recoverable
based on the undiscounted future cash flows. If the carrying amount of the asset is determined not to be recoverable, a write-down to
fair value is recorded. Fair values are determined based on quoted market values, discounted cash flows, or external appraisals, as
appropriate.
Cost of property and equipment (beginning of year)
Cost of property and equipment (end of year)
Capital expenditures during the year
Accumulated depreciation (beginning of year)
Accumulated depreciation (end of year)
Depreciation expense during the year
Cost of property and equipment sold during the year
Accumulated depreciation on property sold
Cash received on property sold
Required:
Complete this question by entering your answers in the tabs below.
1. Reconstruct the journal entry for the disposal of property and equipment during the year.
2. Compute the amount of property and equipment that United Presents wrote off as impaired during the year, if any. (Hint: Set up T-
accounts.)
Required 1 Required 2
Dollars in
Millions
$ 54,644
59,766
6,510
28,016
29,310
2,490
1,388
1,196
130
million
Compute the amount of property and equipment that United Presents wrote off as impaired during the year, if any. (Hint: Set
up T-accounts.)
Note: Enter your answer in millions (i.e., 10,000,000 should be entered as 10).
Impairment loss
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