On December $31,2022,$ Sterling Bank enters into a debt restructuring agreement with Indigo plc$,$ which is now experiencing financial trouble. The bank agrees to restructure a $12\%,$ issued at par, $2,000,000$ note receivable by the following modifications:

Reducing the principal obligation from $2,000,000$ to $1,600,000.$

Extending the maturity date from December $31,2022,$ to January $1,2026.$

Reducing the interest rate from $12\%$ to $10\%.$ Indigo's market rate of interest is $15\%.$

Indigo pays interest at the end of each year. On January $1,2026,$ Indigo pays $1,600,000$ in cash to Sterling Bank.

Can Indigo record a gain under the term modification mentioned above?

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List of AccountsPrepare the amortization schedule of the note for Indigo after the debt modification. $($Round present value factor calculations to $5$ decimal places, e$.$g$.1\mathrm{.}25124$ and the final answer to $0$ decimal places e$.$g$.58,971.)$