Sloane, Inc. purchased equipment in 2015 at a cost of $600,000. Two years later the undiscounted future cash flows of the equipment was $240,000. The book value of the asset is $360,000, and it is estimated that the fair value is $300,000. The entry to record the impairment is:

Select one:

a.

Retained Earnings 60,000

Accumulated Depreciation Equipment 60,000

b.

Loss on Impairment of Equipment 120,000

Reserve for Loss on Impairment of Equipment 120,000

c.

Retained Earnings 120,000

Reserve for Loss on Impairment of Equipment 120,000

d.

Loss on Impairment of Equipment 120,000

Accumulated Depreciation Equipment 120,000

e.

Loss on Impairment of Equipment 60,000

Accumulated Depreciation Equipment 60,000