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What would be the entries for the purchase, evaluation, impairment and sale of the asset

What would be the entries for the purchase, evaluation, impairment and sale of the asset

FINANCIAL ACCOUNTING
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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On December 2, 1998, a piece of land worth $4,500,000 is acquired where there are some warehouses. On April 12, 2000, a qualified expert is hired to appraise the land, who determines that on that date its fair value is $6,900,000. On October 10, 2000, a chemical industry that generates a lot of polluting waste was installed on nearby land, raising the level of life risk in that area, for which the land located in this place lowered its sale price. The company's management considers that there may be an impairment of the value of said land. According to studies carried out by a real estate brokerage firm as of 01-15-2001, the fair value less costs of sale of the land would be $3,500,000; the value in use could not be determined because the land does not generate cash inflows independent of those produced by other assets of the company. On April 10, 2005, the land is sold for $2,100,000. What would be the entries for the purchase, revaluation, impairment and sale of the asset
Transcribed Image Text:On December 2, 1998, a piece of land worth $4,500,000 is acquired where there are some warehouses. On April 12, 2000, a qualified expert is hired to appraise the land, who determines that on that date its fair value is $6,900,000. On October 10, 2000, a chemical industry that generates a lot of polluting waste was installed on nearby land, raising the level of life risk in that area, for which the land located in this place lowered its sale price. The company's management considers that there may be an impairment of the value of said land. According to studies carried out by a real estate brokerage firm as of 01-15-2001, the fair value less costs of sale of the land would be $3,500,000; the value in use could not be determined because the land does not generate cash inflows independent of those produced by other assets of the company. On April 10, 2005, the land is sold for $2,100,000. What would be the entries for the purchase, revaluation, impairment and sale of the asset
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