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Amazon Corporation owns machinery with a book value of $760,000. It is estimated that the machinery will generate future cash flows of $700,000. The machinery has a fair value of $560,000. Amazon should recognize a loss on impairment of:_______.

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Parrain

Answer: $200,000

Explanation:

The loss on impairment refers to the difference between the carrying or book value of an asset and the fair/ recoverable value of same.

Loss on impairment = Book value - Fair value

= 760,000 - 560,000

= $200,000

The value of the machinery would fall by $200,000 to tally it to its fair value.

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