On December 31, 2021, ABC Co. was indebted to XYZ Street Company on a P2M, 10% note.Only interest had been paid to date. Due to its financial difficulties ABC has negotiated arestructuring of its notes payable. The parties agree that ABC would settle the debt on thefollowing terms:• Settle one half of the note by transferring land with a recorded value of P800,000, and a fairvalue of P900,000.• Settle one fourth of the note by transferring 200,000 shares of P1 par ordinary shares with afair value of P1.80 per share.• Modify the terms of the remaining one fourth of the note by reducing the interest to 5%,extend the due date three years from the date of restructuring and reducing the principal toP300,000.Total gains on the settlement of debt to be recognized in profit or loss: *

Only interest had been paid to date. Due to its financial d restructuring of its notes payable. The parties agree that A following terms: • Settle one half of the note by transferring land with a re value of P900,000. • Settle one fourth of the note by transferring 200,000 sha fair value of P1.80 per share. • Modify the terms of the remaining one fourth of the not extend the due date three years from the date of restructu P300.000.

Only interest had been paid to date. Due to its financial d restructuring of its notes payable. The parties agree that A following terms: • Settle one half of the note by transferring land with a re value of P900,000. • Settle one fourth of the note by transferring 200,000 sha fair value of P1.80 per share. • Modify the terms of the remaining one fourth of the not extend the due date three years from the date of restructu P300.000.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 10MC: On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major...

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On December 31, 2021, LoL Co. was indebted to Garena Street Company on a P2M, 10% note. Only interest had been paid to date. Due to its financial difficulties has negotiated a restructuring of its notes payable. The parties agree that LoL would settle the debt on the following terms: • Settle one half of the note by transferring land with a recorded value of P800,000, and a fair value of P900,000. • Settle one fourth of the note by transferring 200,000 shares of P1 par ordinary shares with a fair value of P1.80 per share. Modify the terms of the remaining one fourth of the note by reducing the interest to 5%, extend the due date three years from the date of restructuring and reducing the principal to P300,000. Total gains on the settlement of debt to be recognized in profit or loss is: A.P437,306B.P577,306C.P337,306D.POE.P340,000
On December 31, 2021, LoL Co. was indebted to Garena Street Company on a P2M, 10% note. Only interest had been paid to date. Due to its financial difficulties LoL has negotiated a restructuring of its notes payable. The parties agree that LoL would settle the debt on the following terms: • Settle one half of the note by transferring land with a recorded value of P800,000, and a fair value of P900,000. • Settle one fourth of the note by transferring 200,000 shares of P1 par ordinary shares with a fair value of P1.80 per share. • Modify the terms of the remaining one fourth of the note by reducing the interest to 5%, extend the due date three years from the date of restructuring and reducing the principal to P300,000. Total gains on the settlement of debt to be recognized in profit or loss is: A.P337,306B.P340,000C.P437,306D.P577,306
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On December 31, 2010 a company was indebted to Creditor Co. on a P2,000,000 10% note. Only interest had been paid to date. Due to its financial difficulties, the company has negotiated a restructuring of its note payable. The parties agreed that the company would settle the debt on the following terms: settle 1/2 of the note by transferring land with a recorded value of P800,000 and a fair value of P900,000 • settle 1/4 of the note by transferring 200,000 shares of P1 par ordinary shares with a fair market value of P15 per share modify the terms of the remaining 1/4 of the note by reducing the interest rate to 5%, extend the due date 3 years from the date of restructuring and reducing the principal to P300,000. How much was the (1) total gain on extinguishment of debt and (2) carrying amount of the note payable as of December 31, 2021? O P437,306 and P273,963 O P550,006 and P142,494 O P336.306 and P262,694 O P437,306 and P262.694
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