Please provide a comprehensive solution.

The answer is B. 3400000

Problem 30-19 (AICPA Adapted) On January 1, 2017, Diamond Company purchased equipment for P5,600,000. The equipment had an 8-year useful life and residual value of P800,000. The entity depreciated the equipment using the straight line method. In August 2020, the entity questioned the recoverability of the carrying amount of the equipment. On August 31, 2020, the discounted expected net future cash inflows related to the continued use and eventual disposal of the equipment total P3,500,000. The fair value less cost of disposal of the equipment on such date is P3,000,000. After any loss on impairment has been recognized, what is the carrying amount of the equipment? a. 3,500,000 b. 3,400,000 c. 3,000,000 d. 2,600,000 888