In recording its acquisition of Lambda, Inc., Omega, Inc. properly recognized a contingent consideration liability of $28,000 associated with a possible payment based on a target amount of post-combination cash flow from operations. Shortly after the combination, but during the measurement period, the national economy experienced a significant downturn which made it unlikely that the target amount would be reached. As a consequence, at the end of Omega's fiscal period, the liability was properly revalued to a fair value of $9,000. Which one of the following is the amount of gain or loss that will be recognized in income as a result of the reevaluation of the contingent liability?

	$ - 0 - (no gain or loss)
	$19,000 gain
	$19,000 loss
	$ 9,000 loss

(Answer is B $19,000 gain) This Answer is Correct

A contingent consideration liability is the obligation of an acquirer to transfer additional consideration, if specific conditions are met. Contingent consideration liabilities are initially recognized at fair value and adjusted to fair value each period until the contingency is resolved or expires. A change in fair value resulting from occurrences after the acquisition date would be recognized as a gain or loss in income in the period of the change. In this question, a $19,000 gain (reduction in liability) would be recognized ($28,000 $9,000 = $19,000).

Can please explain why the answer is $19,000 gain and not a $19,000 loss instead regardless of explanation above because I don't understand it? I thought it's a loss because the contingent consideration liability was revalued to $9,000 fair value. Help me to understand this question.