Use the Following Information for Questions 44-46

question 53

Multiple Choice

Use the following information for questions 44-46.
On December 31, 2020, Diaz Corp. is in financial difficulty and cannot pay a $ 900,000 note with $ 90,000 accrued interest payable to Cameron Ltd., which is now due. Cameron agrees to accept from Diaz equipment that has a fair value of $ 435,000, an original cost of $ 720,000, and accumulated depreciation of $ 345,000. Cameron also forgives the accrued interest, extends the maturity date to December 31, 2022, reduces the face amount of the note to $ 375,000, and reduces the market interest rate of 6%, with interest payable at the end of each year.
-Diaz should recognize a gain on the partial settlement and restructure of the debt of

• A) $ 0.
• B) $ 22,500.
• C) $ 112,500.
• D) $ 180,000.

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Definitions:

Hoarding Disorder

A persistent difficulty discarding or parting with possessions, regardless of their actual value, leading to clutter and disruption in living spaces.

Compulsively Collects And Stores

A behavior characterized by an irresistible urge to acquire and keep various objects, leading to excessive accumulation.

Excessive Acquisition Of Objects

The compulsive gathering of items to the point where it negatively impacts one's life, often related to hoarding behavior.

Obsessive-Compulsive Disorder

A mental health disorder characterized by intrusive thoughts (obsessions) that elicit distress and repetitive behaviors or mental acts (compulsions) aimed at reducing the distress.