CYNOSURE COMPANY

Carrying amount 1,600,000

Recoverable amount equal to fair value which is higher than value in use 1,400,000
Impairment loss 200,000

ELITE COMPANY
1. What is the depreciation for 2022?
Depreciation for 2022 (8,400,000/8) 1,050,000

2. What is the gain on reversal of impairment for 2021?

Carrying amount - 1/1/2020 8,550,000
Depreciation for 2021 (8,550,000/9) -950,000
Carrying amount - 12/31/2021 7,600,000

Cost - 1/1/2020 11,000,000

Accumulated depreciation - 12/31/2021 (11,000,000/10 x 2) -2,200,000
Maximum carrying amount - 12/31/2020, no impairment 8,800,000

Fair value less cost o disposal -- 12/31/2021 higher than fair value 8,400,000
Carrying amount - 12/31/2021, with impairment -7,600,000
Gain on reversal of impairment for 2021 800,000

3. What is the impairment loss for 2020?

Cost - 1/1/2020 11,000,000
Accumulated depreciation (11,000,000/10) -1,100,000
Carrying amount - 12/31/2020 9,900,000
Value in use higher than fair value 8,550,000
Impairment loss for 2020 1,350,000