Gamma Corporation owns a specialized machine used in its manufacturing process. The machine, purchased for $500,000, has an estimated useful life of 10 years and no salvage value. At the end of the fifth year, Gamma Corporation's management determines that the machine's carrying value may not be recoverable due to changes in market conditions.

Prepare journal entries to record depreciation expense for the machine for the first five years using the straight-line method. Subsequently, assess the machine for impairment and record any necessary impairment loss. Explain how the impairment affects Gamma Corporation's financial statements and disclosures.