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Department
Business Administration
Course
Business Administration 2257
Professor
Jason Dean
Semester
Fall

Description
CHAPTER 9 (PART II) – REPORTING AND INTERPRETING PROPERTY, PLANT, AND EQUIPMENT; NATURAL RESOURCES; AND INTANGIBLES WESTJET AIRLINES Impairment: Occurs when events or change circumstances cause the book value of long- term assets to exceed their fair value, such as a significant decrease in its market price. If net book value > fair value, then the asset is impaired. Fair value: The amount at which an asset can be bought or sold between two willing parties. Can be determined based on quoted market prices. Impairment loss = Net book value – Fair value The disposal of an amortizable asset usually requires two entries: 1. An adjusting entry to update the amortization expense and accumulated amortization accounts. 2. An entry to record the disposal. Net book value = Original cost – Accumulated amortization Natural resources often called wasting assets, because they are depleted. Depletion: The systematic and rational allocation of the cost of a natural resource over the period of exploitati
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