Sanders corporation operates a factory in arizona. due to a change in business climate an impairment test is deemed appropriate. management has acquired the following information: cost $243,000,000 accumulated depreciation 112,000l,000 estimate of the total undiscounted future cash flows 110,000,000 present value of estimated future cash flows 94,000,000 estimated fair value of the arizona factory, as appraised 90,000,000 required: a) determine the amount of the impairment loss if any. b) if a loss is indicated, prepare the entry to record the loss.

a. The amount of impairment loss is $37,000,000.

Explanation:

a.

Given,

Fair Value = $90,000,000

PV of estimated cash flow = $94,000,000

Recoverable Amount = Whichever is higher from Fair Value OR PV of estimated cash flow

So,

Recoverable Amount = $94,000,000

The formula to compute Carrying amount is:

Carrying Amount = Cost - Accumulated Depreciation

                             = $243,000,000 - $112,000,000

                            = $131,000,000

The asset is impaired when the recoverable amount is less than the carrying amount.

So, in this case, the amount of recoverable is less than carrying amount. Therefore, the asset is impaired.

And Impairment loss is computed as:

= Carrying amount - Recoverable Amount

= $131,000,000 - $94,000,000

= $37,000,000

b.

Journal Entry is as:

Impairment Loss on Equipment A/cDr   $37,000,000

               To Equipment A/cCr   $37,000,000

ans.

heterothermic organisms include those organisms that can switch between homeothermic (having body temperature higher than environment) and poikilothermic (having variation in internal body temperature) strategies.

some migratory birds show heterothermy as they decrease their metabolic rate during cold nights to keep their body temperature low. drop in metabolic rate allows increase in production efficiency of birds that reduces the internal body temperature to make it equal to external cold temperature during cold nights.

thus, the correct answer is 'birds allow their temperature drop in order to increase their production efficiency.'