Kell Corp.'s $95,000 net income for the quarter ended September 30, 20X1, included the following after-tax items:

A $60,000 extraordinary gain, realized on April 30, 20X1, was allocated equally to the second, third, and fourth quarters of 20X1.

A $16,000 cumulative-effect loss resulting from a change in inventory method was recognized on August 2, 20X1.

In addition, Kell paid $48,000 on February 1, 20X1, for 20X1 calendar-year property taxes. Of this amount, $12,000 was allocated to the third quarter of 20X1.

For the quarter ended September 30, 20X1, Kell should report net income of:

A. $91,000.

B. $103,000.

C. $111,000.

D. $115,000.

Answer is: $91,000 because 95,000-20,000+16,000

My question is that why did we add 16,000? Isn't a loss that we should subtract?