Trouble debt c Company C has an unpaid note for $50,000 on January 1, 2011. The

Question

Trouble debt c Company C has an unpaid note for $50,000 on January 1, 2011. The note was written at 12% annual interest. There is also accrued unpaid interest of $6,000. Company c transfers a piece of a land to the bank in partial satisfaction of the note. The land has a cost of $16,000 and a market value of $18,000 The bank reduces the loan by the value of the land and agrees to forgive the accrued interest. The bank than requires four annual future payments of $10,536.50 due each December 31, starting on December 31, 2011 For the debtor make entries on the date of restructure January 1,2011 prepare an amortization table and make the entry on December 31, 2011. For the debtor, make entries on the date of restructure prepare an amortization table and make the entry on December 31, 2011

Explanation / Answer

Ans

Ans 2

Date Account Title Debit Credit Note Payable 18,000.00 Accrued Interest     6,000.00 Land 16,000.00 Gain on surrender of land     2,000.00 Gain on restructruring     6,000.00

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.