Carla Company owes $166,000 plus $14,600 of accrued interest to Sarasota State Bank. The debt is a 10-year, 10% note. During 2020, Carla's business deteriorated due to a faltering regional economy. On December 31, 2020, Sarasota State Bank agrees to accept an old machine and cancel the entire debt. The machine has a cost of $321,000, accumulated depreciation of $176,550, and a fair value of $146,000.