Vaughn, Inc., which owes Tamarisk Co. $1,272,000 in notes payable with accrued interest of $114,480, is in financial difficulty. To settle the debt, Tamarisk agrees to accept from Vaughn equipment with a fair value of $1,208,400, an original cost of $1,780,800, and accumulated depreciation of $413,400.

Compute the gain or loss to Vaughn on the settlement of the debt.

GainLoss on restructuring of debt $