When the contractual cash flows of a financial asset are renegotiated or otherwise modified and the renegotiation or modification does not result in the derecognition of that financial asset in accordance with PFRS 9, an entity shall I. Recalculate the gross carrying amount of the financial asset as the present value of the renegotiated or modified contractual cash flows that are discounted at the financial asset's original effective interest rate. II. Recognize a modification gain or loss in profit or loss. A. I only. B. Neither I nor II. C. ll only. D. Both I and II.
When the contractual cash flows of a financial asset are renegotiated or otherwise modified and the renegotiation or modification does not result in the derecognition of that financial asset in accordance with PFRS 9, an entity shall I. Recalculate the gross carrying amount of the financial asset as the present value of the renegotiated or modified contractual cash flows that are discounted at the financial asset's original effective interest rate. II. Recognize a modification gain or loss in profit or loss. A. I only. B. Neither I nor II. C. ll only. D. Both I and II.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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When the contractual cash flows of a financial asset are renegotiated or otherwise modified and the renegotiation or modification does not result in the derecognition of that financial asset in accordance with PFRS 9, an entity shall
I. Recalculate the gross carrying amount of the financial asset as the present value of the renegotiated or modified contractual cash flows that are discounted at the financial asset's original
effective interest rate.
II. Recognize a modification gain or loss in profit or loss.
A. I only.
B. Neither I nor II.
C. ll only.
D. Both I and II.
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