On January 1, 2019, a machine owned and operated by a Construction . was destroyed by fire. The machine was purchased 2 years earlier for $23,000 and had an original useful life of 10 years, and an estimated salvage (residual) value of $3,000. Depreciation on the machinery was calculated under a straight-line basis for the first two years. Wells Construction filed an insurance claim and recovered $16,500 from the insurer. Based on this information, how much of a gain or loss should be included in Wells 2020 income statement?

a. $500 gain

b. $1,900 loss

c. $2,500 loss

d. $6,500 loss