Choice "D" is correct. Under U.S. GAAP, goodwill impairment exists because the $3,310,000 fair value of the reporting unit is less than its $3,450,000 carrying value of the reporting unit. After allocating $3,170,000 of the fair value of the reporting unit to its assets and liabilities other than goodwill, the $140,000 ($3,310,000 - $3,170,000) unallocated fair value is the implied fair value of the goodwill and the goodwill impairment loss is: Impairment loss Impairment loss$140,000 - $225,000$85,000Choice "b" is incorrect. An impairment loss must be recorded because the $3,310,000 fair value of the reporting unit is less than its $3,450,000 carrying value of the reporting unit.
Choice "a" is incorrect. This is the implied fair value of the goodwill, not the goodwill impairment loss.
Choice "c" is incorrect. The entity will not write-off the entire amount of the goodwill. The impairment loss is equal to the difference between the implied fair value of the goodwill and the book value of the goodwill.