Goodwill Impairment on September 1, 2020, Piper Corporation Acquired Darcy Enterprises for Enterprises

Essay

Goodwill impairment
On September 1, 2020, Piper Corporation acquired Darcy Enterprises for a cash payment of $ 850,000. At the time of purchase, Darcy's statement of financial position showed assets of $ 890,000, liabilities of $ 450,000, and owner's equity of $ 440,000. The fair value of Darcy's assets is estimated to be $ 1,150,000. Assume that Piper is a public company and the goodwill was allocated entirely to one cash-generating unit (CGU). Two years later, the CGU's carrying amount is $ 3,450,000; its value in use is $ 3,380,000; the fair value less costs to sell is $ 2,980,000.
Instructions
Determine if goodwill is impaired, and calculate the goodwill impairment loss.