37. Purity Company owes P1,998,000 to Sanctity, Inc. The debt is a 10year, 11% note. Because Purity Company is in nancial trouble, Sanctity, Inc. agrees to accept some property and cancel the entire debt. The property has a book value of P800,000 and fair market value of 1,200,000. What amount of gain or loss on the settlement of the liability should Purity Company recognize? a. P0 b. P400000 c. P798000 d. P1198000