In 2009, Cilla Company acquired production machinery at a cost of $410,000, which now has a accumulated depreciation of $240,000. The undiscounted cash flows from use of the machinery is $190,000 and it’s fair value is $145,000. What amount should Cilla recognize as a loss on impairment?
A. $20,000
B. $35,000
C. $70,000
D. -0-
Answer:D
In 2009, Cilla Company acquired production machinery at a cost of $410,000, which now has a accumulated depreciation of $240,000. The undiscounted cash flows from use of the machinery is $190,000 and it’s fair value is $145,000. What amount should Cilla recognize as a loss on impairment?
A. $20,000 B. $35,000 C. $70,000 D. -0-