January 1, 20x1, an entity has an outstanding note payable with carrying amount of P1,000,000. On this date, the debtor agrees to receive 10,000 shares of theentity with par value per share of P10 in full settlement of the note payable. The shares are currently selling at P75 per share. Requirements: a. Compute for the gain or loss on the derecognition of the note payable. b. Provide
January 1, 20x1, an entity has an outstanding note payable with carrying amount of P1,000,000. On this date, the debtor agrees to receive 10,000 shares of theentity with par value per share of P10 in full settlement of the note payable. The shares are currently selling at P75 per share. Requirements: a. Compute for the gain or loss on the derecognition of the note payable. b. Provide
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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On January 1, 20x1, an entity has an outstanding note payable with carrying amount of P1,000,000.
On this date, the debtor agrees to receive 10,000 shares of theentity with par value per share of P10 in full settlement of the note payable. The shares are currently selling at P75 per share.
Requirements:
a. Compute for the gain or loss on the derecognition of the note payable.
b. Provide the entry to record the derecognition of the note payable.
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