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The information that follows relates to equipment owned by Bonita Limited at December $31,2023$:

Cost

$$8,640,000$

$960,000$

Accumulated depreciation to date

$960,000$

Expected future net cash flows $($undiscounted$)$

$6,720,000$

Expected future net cash flows $($discounted$,$ value in use$)$

$6,096,000$

Fair value

$5,952,000$

Costs to sell $($costs of disposal$)$

$48,000$

At December $31,2023,$ Bonita discontinues use of the equipment and intends to dispose of it in the coming year by selling it to a

competitor. It is expected that the costs of disposal will total $$48,000.$

$($a$1-$a$3)$

Assume that Bonita is a private company that follows ASPE. $($Credit account titles are automatically indented when the amount is

entered. Do not indent manually. If no entry is required, select $"$No Entry" for the account titles and enter $0$ for the amounts. List all debit

entries before credit entries.$)$

Prepare the journal entry at December $31,2023,$ to record asset impairment, if any.

Prepare the journal entry to record depreciation expense for $2024.$

Assume that the asset was not sold by December $31,2024.$ The equipment's fair value $($and recoverable amount$)$ on this

date is $$6\mathrm{.}24$ million. Prepare the journal entry, if any, to record the increase in fair value. It is expected that the costs of

disposal will total $$48,000.$

No$.$ Account Titles and Explanation

Debit

Credit

$(1)$

$(2)$

$(3)$

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