Herron realty company owns a number of large buildings in several cities in the united states. One of the buildings is 16 years old and has had a large number of vacant office suites for several years. The buildings book value is $13 million. The company has examined carefully its future cash flows and has determined it is highly unlikely that the company can recover the buildings book value from future cash flow. Further study in november 2013 has resulted in three estimates of the market value of the building. All of the estimates value are approximately $8.2 million. 1. Should herron record impairment of the building? Why? 2. If impairment should be recorded, what is the amount of impairment? 3. What accounting entry would be neccesary based on the above facts? 4. If impairment is recorded in 2013 and subsequently the value of the building increases in 2014 so the market value exceeds the book value, should the book value of the building be increased at the time? Analyze: how could the company use its estimates of cash flow to arrive at a "market value" of the building?