Jennie Limited and Jisoo Pty Limited entered into a joint operation, BP.Perfume, at the beginning of the financial year to produce and sell fragrances. The joint operation agreement indicates the parties will share output, contributions and costs, and hold the joint operation assets as tenants in common, with the respective interests being 60% Jennie Limited and 40% Jisoo Pty Limited. Jennie Limited contributed the equipment which has a book value of $600,000 and a fair value at the date of contribution of $960,000 whilst Jisoo Pty Limited contributed cash of $640,000. Jennie Limited chose not to revalue their remaining interests in the contributed assets in their separate records.

Using the line-by-line method, consistent with AASB 11 Joint Arrangements, what would be the gain on sale recorded by Jennie Limited on contribution of the asset to the joint operation?

a. $144,000

b. $216,000

c. $360,000

d. $72,000