Indicate how each event affects the elements of the financial statements. Use the following letters to record your answer in the box shown below each element. You do not need to enter amounts. Increase = IDecrease = DNo Effect = NA(Note that "No Effect" means that the event does not effect that element of the financial statements or that the event causes an increase in that element that is offset by a decrease in that same element.) On May 16, Year 5, Zinke Corporation recognized an impairment loss of $50,000 of goodwill. The goodwill was originally recorded two years earlier in connection with the acquisition of another company. Show how the impairment loss affected the financial statements in Year 5.AssetsLiabilitiesStk. EquityRevenuesExpensesNetStmt. of ?IncomeCash

Flows???????

What will be an ideal response?


(D) (NA) (D) (NA) (I) (D) (NA)
Impairment of goodwill decreases assets (goodwill) and stockholders' equity (retained earnings). It increases expenses (impairment loss), which decreases net income. It does not affect the statement of cash flows.

Business

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