At the beginning of the accounting period, equipment had a carrying amount (or net book value) of $45,000 including accumulated depreciation of $32,500 and accumulated impairment of $7,500. This years depreciation expense is $7,600. The fair value of the equipment is $42,000.

What is the journal entry for revaluing the equipment to fair value?

a.

DR Depreciation expense $7,600 and CR Accumulated depreciation $7,600; and DR Accumulated depreciation $40,100, CR Equipment $35,500, and CR Revaluation Surplus $4,600

b.

DR Depreciation expense $7,600 and CR Accumulated depreciation $7,600; and DR Accumulated depreciation $40,100, DR Accumulated Impairment $7,500, CR Equipment $43,000, and CR Revaluation Surplus $4,600

c.

DR Loss on revaluation $3,000 and CR Equipment $3,000

d.

DR Depreciation expense $7,600, CR Accumulated depreciation $3,000, and CR Revaluation Surplus $4,600