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(6 marks) Jobber Corporation, which follows IFRS, is a manufacturer of technology items. Its capital...

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Accounting

(6 marks) Jobber Corporation, which follows IFRS, is a manufacturer of technology items. Its capital assets include specialized equipment that is being used in the assembly stage of its manufacturing process for a new product, its digital home assistant.

Original cost of equipment

1,000,000

Net book value at June 30, 2020

260,000

At June 30, 2020, Jobber noticed that nobody was buying the home assistant and that the assembly equipment would have to be scrapped or significantly altered. An analysis determined the following estimated values for the equipment:

Future net cash flows

290,000

Value in use

240,000

Fair value, net of selling costs

220,000

Instructions

(a) Prepare the journal entry, if any, to record the impairment loss at June 30, 2020.

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