Parts a.) and b.) I understand and can figure out the answer correctly. In a), the equipment is impaired. In part b) the impairment loss is $55,000. Part c) I cannot get the correct depreciation expense for 2016. Do either the fair value of $90000 or cash inflow of $125000 relate to the depreciation expense? And part d.) I think can be answered once part c.) is determined. Thanks.

Problem E8-35: Zeibart Company purchases equipment for $225,000 on July 1, 2012, with an estimated useful life of 10 years and expected salvage value of $25,000. Straight-line depreciation is used. On July 1, 2016, economic factors cause the fair value of the equipment to decline to $90,000. On this date, Zeibart examines the equipment for impairment and estimates $125,000 in future cash inflows related to use of this equipment. a) Is the equipment impaired at July 1, 2016? Explain. b) If the equipment is impaired on July 1, 2016, compute the impairment loss and prepare a journal entry to record the loss. c) What amount of depreciation expense would Zeibart record for the 12 months from July 1, 2016 through June 30, 2017? Prepare a journal entry to record this depreciation expense. (Hint: Assume no change in salvage value.) d) Using the financial statement effects template, show how the entries in parts b) and c) affect Zeibart Company's balance sheet and income statement