Vaughn Corporation follows IFRS. The company's fiscal year end was December 31, 2017. Following the end of the company's fiscal year, but prior to the release of financial reporting for the 2017 fiscal year, two significant events took place:

On January 12, vandals broke into the company's warehouse and caused major damage to both the facility and the inventory. Damages have been assessed at $235,000. Identify the effect that it will have on Vaughn' 2017 net income. Ignore taxes

Net income will: