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Which of the following modification of terms will not qualif, for derecognition of financial liability?

Which of the following modification of terms will not qualif, for derecognition of financial liability?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Which of the following modification of terms will not qualif, for derecognition of financial liability? * a. A P1,000,000 bonds payable was due for payment on September 01, 2019. The maturity date has been extended up to September 01, 2020 with the face amount still the same. b. The market rate of interest associated with 2,500 bonds was 10% when these bonds were sold. Present value of the bonds was computed based on this percentage. Months later, prices in the market significantly changed making a shift from 10% to 11.5% effective rate. c. P375,000 of interest that accrued from the last date of interest payment up to the present time has been condoned or forgiven. The face amount though of P5,000,000 is unchanged and would be paid at the original date stated on the bond indentures. d. A previous P2,000,000 bonds was replaced by another bond payable of the same amount but with a different nominal rate of 9% instead of the old 11% rate.
Transcribed Image Text:Which of the following modification of terms will not qualif, for derecognition of financial liability? * a. A P1,000,000 bonds payable was due for payment on September 01, 2019. The maturity date has been extended up to September 01, 2020 with the face amount still the same. b. The market rate of interest associated with 2,500 bonds was 10% when these bonds were sold. Present value of the bonds was computed based on this percentage. Months later, prices in the market significantly changed making a shift from 10% to 11.5% effective rate. c. P375,000 of interest that accrued from the last date of interest payment up to the present time has been condoned or forgiven. The face amount though of P5,000,000 is unchanged and would be paid at the original date stated on the bond indentures. d. A previous P2,000,000 bonds was replaced by another bond payable of the same amount but with a different nominal rate of 9% instead of the old 11% rate.
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