Bloomington Inc. exchanged land for equipment and $2,900 in cash. The book value and the fair value of the land were $104,500 and $89,600, respectively.

Assuming that the exchange has commercial substance, Bloomington would record equipment and a gain/(loss) on exchange of assets in the amounts of:

Equipment Gain/(loss)

a. $ 86,700 $ 2,900

b. $ 104,500 $ (2,900 )

c. $ 86,700 $ (14,900 )

d. None of these answer choices are correct.