Sandhill Industries has several assets as part of a cash, generating unit that have limited use due to changing market trends and declining demand for the product produced by these assets. Management estimates that the carrying value of these assets is $86600 and the assets have no other use. The company intends on producing this product for three more years prior to disposing of the assets. The net future cash flows related to the product production and sale of the equipment is $87600, while the present value of the cash flows is $81950. The fair value less the cost of disposal of the assets is estimated at $71300. What is the value of the impairment loss under the rational entity model? $0, there is no impairment loss $4650 $15300 O $5450

Sandhill Industries has several assets as part of a cash, generating unit that have limited use due to changing market trends and declining demand for the product produced by these assets. Management estimates that the carrying value of these assets is $86600 and the assets have no other use. The company intends on producing this product for three more years prior to disposing of the assets. The net future cash flows related to the product production and sale of the equipment is $87600, while the present value of the cash flows is $81950. The fair value less the cost of disposal of the assets is estimated at $71300. What is the value of the impairment loss under the rational entity model? $0, there is no impairment loss $4650 $15300 O $5450

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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