A cable car at the Valmorine resort cost 400,000. It is depreciated on a straight-line basis over 10 years, with a residual value of 40,000. After 4 years of operation, a lasting fall in visitor numbers leads to an estimated recoverable amount of 196,000; the residual value and the total useful life are unchanged. Compute the impairment loss, then the annual depreciation charge for the following years.
- Cost of the cable car
- 400,000
- Residual value
- 40,000
- Total useful life
- 10
- Period elapsed
- 4
- Recoverable amount
- 196,000