White Printing Company determines that a printing press used in its operations has suffered a permanent impairment in value because of technological changes.An entry to record the impairment should

Question

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When an asset such as the printing press suffers a permanent impairment in value due to technological changes, an impairment loss should be recognized by reducing the carrying amount of the asset to its recoverable amount. This reduction should be debited to the impairment loss account and credited to the equipment accumulated depreciation account, which will result in a lower carrying amount of the asset on the balance sheet. The credit to the accumulated depreciation account is to reflect the fact that the asset's value has already been partially expensed over its useful life. Option A is incorrect because an impairment loss is not classified as an extraordinary item. Option C is incorrect because it would result in overstating the value of the equipment on the balance sheet. Option D is incorrect because an impairment loss should still be recognized, even if the equipment is still being used.

White Printing Company Determines That a Printing Press Used in Its