At the beginning of 2011, the Healthy Life Food Company purchased equipment for $42million to be used in the manufacture of a new line of gourmet frozen foods. Theequipment was estimated to have a 10-year service life and no residual value. Thestraight-line depreciation method was used to measure depreciation for 2011 and 2012.Late in 2013, it became apparent that sales of the new frozen food line were significantlybelow expectations. The company decided to continue production for two more years(2014 and 2015) and then discontinue the line. At that time, the equipment will be soldfor minimal scrap values.The controller, Heather Meyer, was asked by Harvey Dent, the company's chief executiveofficer (CEO), to determine the appropriate treatment of the change in service life of theequipment. Heather determined that there has been an impairment of value requiring animmediate write-down of the equipment of $12,900,000. The remaining book valuewould then be depreciated over the equipment's revised service life.