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asambeis [7]
3 years ago
15

The management of Petro Garcia Inc. was discussing whether certain equipment should be written off as a charge to current operat

ions because of obsolescence. This equipment has a cost of $900,000 with depreciation to date of $400,000 as of December 31, 2020. On December 31, 2020, management projected its future net cash flows from this equipment to be $300,000 and its fair value to be $230,000. The company intends to use this equipment in the future. Prepare the journal entry (if any) to record the impairment at December 31, 2020
Business
1 answer:
tigry1 [53]3 years ago
5 0

Answer:

Dec 31,2020

Dr Loss on impairment $270,000

Cr Accumulated depreciation-Equipment $270,000

Explanation:

Preparation of the journal entry to record the impairment at December 31, 2020

First step is to calculate the Loss on impairment

Cost $900,000

Less: Accumulated depreciation ($400,000)

Carrying Amount $500,000

Less: Fair value ($230,000)

Loss on impairment $270,000

Now let Prepare the journal entry

Dec 31,2020

Dr Loss on impairment $270,000

Cr Accumulated depreciation-Equipment $270,000

(To record the impairment)

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Clothing from several companies, for instance, might be supplied in a chosen manner. Instead of putting its products in a variety of retailers like Walmart or Target, a company like Gucci might decide to distribute its goods to its own stores and a few carefully chosen department stores.

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By enhancing customer interactions with your organization, distribution strategy contributes to increased client satisfaction and repeat business. Additionally, it might assist you in streamlining your company to increase efficiency.

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2 years ago
Poodle Corporation was organized on January 3, 2011. The firm was authorized to issue 100,000
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Answer:

C. $370,000

Explanation:

Poodle Corporation was organized on January 3, 2011. The firm was authorized to issue 100,000  shares of $5 par common stock.

During 2011, Poodle had the following transactions relating to  shareholders' equity:

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Paid dividends of $50,000.

Therefore total Paid-in capital at the end of 2011 is derived by :

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4 years ago
The first paragraph or part of a business letter is the
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3 years ago
A registered representative has left one firm to join another. Sometime later, the former employer discovers that some informati
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Form U5 must be filed within thirty days of the date of the termination event, and it requires a firm to provide accurate answers to various questions, including the reason for an associated person's termination of their registration.

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2 years ago
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