Recording Entries for Impairment-AFS Determine the amount of impairment loss (if any) to record in income under the following three separate scenarios for an AFS debt investment. In all three cases, the company does not intend to sell and does not believe it is more likely than not that it will be required to sell the investment before recovery of any unrealized loss. Assume that the company has already adjusted the AFS investments to fair value through OCI. Scenario Fair value $ Amortized cost $ Expected credit loss $ Impairment loss $ 1 216,000 $ 192,000 $ 36,000 $ 05 2 168,000 $ 192,000 $ 36,000 $ 24,000 $ 3 144,000 192,000 36,000 12,000 x
Recording Entries for Impairment-AFS Determine the amount of impairment loss (if any) to record in income under the following three separate scenarios for an AFS debt investment. In all three cases, the company does not intend to sell and does not believe it is more likely than not that it will be required to sell the investment before recovery of any unrealized loss. Assume that the company has already adjusted the AFS investments to fair value through OCI. Scenario Fair value $ Amortized cost $ Expected credit loss $ Impairment loss $ 1 216,000 $ 192,000 $ 36,000 $ 05 2 168,000 $ 192,000 $ 36,000 $ 24,000 $ 3 144,000 192,000 36,000 12,000 x
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Recording Entries for Impairment-AFS
Determine the amount of impairment loss (if any) to record in income under the following three separate
scenarios for an AFS debt investment. In all three cases, the company does not intend to sell and does
not believe it is more likely than not that it will be required to sell the investment before recovery of any
unrealized loss. Assume that the company has already adjusted the AFS investments to fair value
through OCI.
Scenario
Fair value
$
Amortized cost
$
Expected credit loss $
Impairment loss $
1
216,000 $
192,000 $
36,000 $
0$
2
168,000 $
192,000 $
36,000 $
24,000 $
3
144,000
192,000
36,000
12,000 x](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd9761f7c-f7f1-45e0-bde2-3d14caa4547d%2Fbb186195-ba07-43a0-ad7b-c9d8f034b22d%2Fet8l8l_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Recording Entries for Impairment-AFS
Determine the amount of impairment loss (if any) to record in income under the following three separate
scenarios for an AFS debt investment. In all three cases, the company does not intend to sell and does
not believe it is more likely than not that it will be required to sell the investment before recovery of any
unrealized loss. Assume that the company has already adjusted the AFS investments to fair value
through OCI.
Scenario
Fair value
$
Amortized cost
$
Expected credit loss $
Impairment loss $
1
216,000 $
192,000 $
36,000 $
0$
2
168,000 $
192,000 $
36,000 $
24,000 $
3
144,000
192,000
36,000
12,000 x
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