Klopp Company owes a note to Sarri Bank. During 2020, Klopps business deteriorated due to a faltering regional economy. On August 3, 2020, Sarri Bank agrees to accept a building and cancel the entire debt. The note has a face value of $350,000 and a discount balance of $48,000 on this date. The building has a cost of $760,000, accumulated depreciation of $543,000, and a fair value of $280,000. How much gain/loss on the disposition of building and on restructuring of debt should Klopp record, respectively?

Multiple Choice

a) gain of $41,000 and gain of $22,000

b) loss of $480,000 and gain of $70,000

c) loss of $41,000 and gain of $70,000

d) gain of $63,000 and gain of $22,000