Fundamental Accounting Principles 22th Edition by John Wild ,Ken Shaw,Barbara Chiappetta

Exercise 48

Assume a company's equipment carries a book value of $16,000 ($16,500 cost less $500 accumulated depreciation) and a fair value of $14,750, and that the $1,250 decline in fair value in comparison to the book value meets the two-step impairment test. Prepare the entry to record this $1,250 impairment.