USA Accruals and writting off assets

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Next year we may have to part with some equipment of over 100k of book value. This is because some strategy implemented this year Nov/dec 2012 we expect at least 60% to be written off as a loss.

Can this expense be accured this year so that it does not impact NI for 2013?
 

Triest123

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Next year we may have to part with some equipment of over 100k of book value. This is because some strategy implemented this year Nov/dec 2012 we expect at least 60% to be written off as a loss.

Can this expense be accured this year so that it does not impact NI for 2013?
=> Yes, but you have to make an impairment for the equipment in this year but not an
accrual.
 

bklynboy

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Equipment is always at lower of FV or cost. Triest123 is correct, if you can not recover the cost of the asset you need to write it down to FV as an impairment in the current period.
 
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Agree with Triest123 and bklynboy. If this is to be accounted for this year then the equipment is impaired. This should be the difference to current Fair Value.
 

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