Silver co owed Albert trust $12 million under a 11% note due December 31, 2020. Note was issued at par and interest is paid at the end of the year. Silver co was experiencing severe financial difficulties and asked Alberta trust to negotiate the terms of the debt agreement. Alberta trust agreed to 1. Extend the maturity date to December 31, 2022 2. Reduce the principal amount to $11 million 3. Reduce the interest rate to 7%. Determine is this is a settlement or a modification. Prepare the journal entries by silver co on December 31,2020 and 2021?