Dillman Corporation owns machinery with a book value of $190,000.It is estimated that the machinery will generate future cash flows of $175,000.The machinery has a fair value of $140,000.Dillman should recognize a loss on impairment of

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Dillman Corporation should recognize a loss on impairment when the carrying amount of the asset exceeds its fair value. In this case, the carrying amount of the machinery is $190,000 while its fair value is $140,000, resulting in a difference of $50,000. Therefore, Dillman Corporation should recognize a loss on impairment of $50,000.

Dillman Corporation Owns Machinery with a Book Value of $190,000