Reference no: EM133184736

Question - ABC Ltd revealed the following assets in its statement of financial position at 30 June 2019:

Plant $800,000

Accumulated depreciation (240,000)

Land 300,000

Patent 240,000

Office equipment 620,000

Accumulated depreciation (340,000)

Inventory 220,000

Cash and cash equivalents 180,000

Goodwill on acquiring DEF Ltd 50,000

$1,830,000

The recoverable amount of the entity was calculated to be $1,660,000. The fair value less costs of disposal of the land was $280,913.

Required -

(1) Calculate the allocation of impairment loss at 30 June 2019;

(2) Prepare the journal entries with narration to recognise that impairment loss.