If you'd like to fix this problem without having to create the 'missing' folder in a location that 'shouldn't' exists since you have chosen path other than the 'default' path...

If you can't use TRUNCATE_ONLY Option

You may want to run the following command instead:

BACKUP LOG [Databasename] WITH NO_LOG

The NO_LOG clause removes the inactive part of the log without making a backup copy...

I've lost 2 points on that one but I'm afraid I have to disagree on the correct answer.

There definitely IS a difference between the TRUNCATE WITH NO_LOG and TRUNCATE_ONLY options......