Bloomington Inc. exchanged land for equipment and $3,000 in cash. The book value and the fair value of the land were $104,000 and $90,000, respectively. Bloomington would record equipment and a gain/(loss) of:

Question

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In this transaction, Bloomington Inc. exchanged land with a book value of $104,000 for equipment and $3,000 in cash. The fair value of the land was $90,000, which means there is a loss on the exchange of $14,000 ($104,000 - $90,000). Since the exchange involves non-monetary assets, the gain or loss is recognized immediately. 
The journal entry to record the exchange would be as follows:

Equipment: $90,000 
Cash: $3,000 
Loss on exchange: $14,000 
Land: $104,000

Therefore, choice C is the correct option for Bloomington to record equipment and a loss of $14,000.