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How much should MIRANDA report as gain

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Problem - MIRANDA CO. went into a loan agreement with HATTA CORP. on December 31, 2018. Under such agreement, the P5 million is payable after 3 years with 10% interest. MIRANDA CO. could not keep up with interest payments. As such P650,000 interest was accrued as of December 31, 2021. In order to minimize losses, HATTA agreed for a debt restructuring and accepted a tract of land with fair value of P3.25 million as settlement of the note and accrued interest. The land was acquired at a cost of P1.25 million.How much should MIRANDA report as gain on the extinguishment of the debt? How much should MIRANDA report as gain(loss) on exchange resulting from the debt restructuring?

Reference no: EM132858834

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