Pitr Company is the defendant in a lawsuit fied by Hetfman in Year 1 disputing the validity of a copyright held by Prt. An December 31 of Year 1 , Pits determined thas Hottman would probably be successful against Pit for an estimated amount of 51,280,000. Appropriately, an \$1,280,000 loss was accrued by a charge to income of Pitt for the year ended December 31 of Year 1 . On December 15 of Year 2, Pitt and Hoffrnan agreed to a settiement providing for cash payment of $800,000 by Pitt to Hoffman and transfer of Pitts copyright to Hoffman, The carrytrg amount of the copyright on Pier's actounting records was 5192,000 an Decenter 15 of Year 2 . a. What would be the effect of the sertement of this bablity on Pir's pretax income before income tax in Year 2 ? b. Record the entry on December 15 of Year 2 for pith Compary