Four Company has issued a P 5,000,000, 10%, 3 year note on January 1, 2020...
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Accounting
Four Company has issued a P 5,000,000, 10%, 3 year note on January 1, 2020 to Todo Bank, during which the prevailing market rate is 12%. One year after, the company was not able to pay its interest because of financial difficulties and pandemic. Todo Bank decided to reconstruct the loan under the following new agreements.
1.The Loan will be reduced to P 4,000,000
2.The unpaid interest will be waived.
How much is the gain or (loss) on the reconstruction?(Round your factors to four decimal places)
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