What loss should acme recognize on the impaired value of


Acme Company owns a donut-maker that has a book value of $66,000 and a remaining life of 8 years. Many of Acme's customers have switched to eating biscuits and so the donut-maker is not generating the profits it was when first bought. No one really wants a used donut-maker so it has a fair value of $31,000. If Acme chooses to keep the donut-maker, officials believe that it can be used to generate net cash inflows of $9,000 per year for its remaining life. The present value of those cash flows at a reasonable interest rate is $34,000. What loss should Acme recognize on the impaired value of the donut-maker?

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Financial Accounting: What loss should acme recognize on the impaired value of
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